Italy ‘optimistic’ as new cabinet sworn in

Italian Prime Minister Paolo Gentiloni's new cabinet was officially sworn in on Monday evening as the eurozone's third largest economy raced to reassure Europe its political crisis was over.

Italy 'optimistic' as new cabinet sworn in
Italy's President Sergio Mattarella (L) shakes hands with newly appointed Prime Minister Paolo Gentiloni. Photo: Tiziana Fabi/AFP

Gentiloni, 62, called to head up a new centre-left government after prime minister Matteo Renzi's resignation following a crushing referendum defeat, kept the line-up largely unchanged from the outgoing administration to ensure political stability.

The new government will guide Italy to elections due by February 2018, but which could come up to a year early.

“I put my everything into finding the fastest solution possible” to the crisis, Gentiloni said.

“As you can see from its make-up, the government will continue the innovative path of the Renzi government,” he added.

In a time-honoured tradition, Renzi symbolically handed over power to Gentiloni by passing him a little silver ceremonial bell.

Gentiloni named Angelino Alfano – a former protege of ex-prime minister Silvio Berlusconi – to take over his role as foreign minister.

Pier Carlo Padoan stays on as finance minister in a move likely to reassure the markets Italy can deal with a brewing crisis in the banking sector.

Alfano's post as interior minister under Renzi goes to Marco Minniti, who was the state secretary with responsibility for the security services in the outgoing administration.

'Strength and optimism'

Maria Elena Boschi, who was the minister in charge of constitutional reforms under Renzi – and therefore responsible for the very reform that lead to his downfall – becomes undersecretary to the prime minister.

The 35-year old is a die-hard Renzi ally and is expected to ensure the former PM's voice is still heard in the new administration.

“Good luck to Paolo Gentiloni and the government with the job. Long live Italy,” Renzi said on Twitter.

Opposition parties have slammed the softly-spoken Gentiloni as little more than a Renzi puppet.

The anti-establishment Five Star movement said keeping the old crew at the helm ignored the wishes of those who voted against Renzi at the referendum. Its founder, comic Beppe Grillo, said the Stars would organize a mass protest for January.

Giorgia Meloni from the right-wing Brothers of Italy also slammed it as “a spit in the face for the Italians” and promised a large rally.

Gentiloni admitted the referendum defeat had revealed mass discontent among the middle classes and young over the sluggish economy and unemployment, and said the job market would be “a priority for this government”.

“I won't deny there are difficulties” in the wake of Renzi's fall, but “the government will get to work immediately… with strength and optimism” he said.

Markets buoyed

Silver-haired Gentiloni, a one-time student radical from an aristocratic family, will seek parliamentary approval of his new government on Tuesday.

Milan's FTSE Mib saluted the new prime minister, remaining positive throughout the day.

The market had also been buoyed by relief over the news the Italian government would intervene to recapitalize Italy's Monte dei Paschi di Siena bank (BMPS), should it fail to raise the money from private investors needed to stay afloat.

And just hours after Gentiloni was named as prime minister, the ailing bank said it was hopeful a bailout could be avoided.

Oanda analyst Craig Erlam said investors were “more optimistic” the bank could raise the 5 billion euros ($5.29 billion) needed to avoid a handout and were relieved political uncertainty had been removed in the short term at least.

Gentiloni has been rushing to resolve the political crisis in time for Italy to attend the European Council meeting in Brussels on Thursday, where the pressing issue of migration is on the table.

Italy is on the frontlines of the migrant crisis, with a record 175,000 people landing on its shores this year alone.

Renzi may be down and out for now, but analysts said he had tapped Gentiloni to replace him because he trusts him to keep his seat warm for the next general elections, which could be brought forward to early next year.

By Ella Ide

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Doubts rise over ‘loose cannon’ Salvini after Italy’s election

Italian anti-immigrant leader Matteo Salvini was disappointed on Monday at his party's result in general elections but pledged to work with Giorgia Meloni, who triumphed, to form a government.

Doubts rise over 'loose cannon' Salvini after Italy's election

Whether Salvini would keep his word – or survive politically long enough to do so – was not clear, after his anti-immigrant League party dropped below the 10 percent threshold at Sunday’s vote.

This was a sharp decrease after the party swept to office with 17 percent of the vote in 2018 – since when it has been eclipsed by Meloni’s post-fascist Brothers of Italy.

EXPLAINED: What will a far-right government mean for Italy?

A glum Salvini, who has clashed with Meloni on a range of policies, not least her stance on Russia and the war in Ukraine, told reporters that winning just nine percent had been a blow.

It was “not a number I wanted or worked for”, he said.

Salvini added that he had “gone to bed fairly pissed off but woke up ready to go” and was now “looking on the bright side”.

Meloni “was good. We will work together for a long time”, he promised.

Leader of Italy's liberal-conservative party Forza Italia, Silvio Berlusconi, leader of Italy's conservative party Brothers of Italy, Giorgia Meloni and leader of Italy's far-right League party, Matteo Salvini acknowledge supporters at the end of a joint rally against the government on October 19, 2019 in Rome.

Italy’s right-wing coalition, consisting of Meloni’s Brothers of Italy, Salvini’s League and Berlusconi’s Forza Italia, has promised to slash taxes and put ‘Italians first’. Photo by Tiziana FABI / AFP

The League may now have to battle to ensure its priorities are not sidelined in Meloni’s government programme, analysts said.

And while ex-interior minister Salvini has repeatedly said he wants his former job back, it is looking increasingly unlikely to happen.

“It won’t be an easy relationship. It’s likely that (Salvini) will be given a more marginal role in the government than he wants,” Sofia Ventura, political sciences professor at Bologna University, told the foreign press association in Rome.

“The result… throws into question Matteo Salvini’s leadership” of his own party, she said, adding that there were those within the League who thought they would be better off without the “loose cannon”.

READ ALSO: Meloni, Salvini, Berlusconi: The key figures in Italy’s likely new government

He said Meloni had benefited from being the only leader to stay outside the coalition formed by Prime Minister Mario Draghi in February 2021.

For the League, being part of that administration “was not easy”, he said, but insisted “I would do it again.”

‘Dangerous when cornered’

Meloni secured around 26 percent of the vote in Sunday’s poll, putting her on course to become the first woman to serve as Italian prime minister.

She campaigned as part of a coalition including Salvini’s League and ex-premier Silvio Berlusconi’s Forza Italia, which won around eight percent.

Italian politics is notoriously unstable, with nearly 70 governments since 1946, and there were concerns disagreements with Salvini may precipitate a fresh crisis.

Lorenzo Pregliasco, co-founder of the YouTrend polling site, said Italian party leaders proved “dangerous” when they felt cornered.

The League head “might not create any problems in the short term” but “watch out for the Salvini factor, if he survives politically as a leader”.

Salvini however said that after years of unwieldy coalitions, Italy finally had “a government chosen by its citizens, with a clear majority” in both houses of parliament.

And he hoped it could “go for at least five years straight, without changes, without upheavals, focusing on things to do”.