Italy: New Government Ends Political Deadlock

Weeks of political deadlock have ended in Italy as Enrico Letta of the centre-left becomes the new PM and forms a government.

Mr Letta, a 46-year-year-old leftist moderate, leads a broad-coalition government backed by his own Democratic Party and the conservatives of former prime minister Silvio Berlusconi.

The government will be sworn in on Sunday and then faces votes of confidence in both houses of parliament, possibly as early as Monday.

A general election in February proved inconclusive, with the electorate split among three main blocs and no party winning enough of the vote to muster majorities in parliament.

Since then a political stalemate had paralysed Italy, unnerving markets at a time of deep economic crisis.

Silvio Berlusconi is backing the new government

Mr Letta is a pro-European, reform-oriented politician who has served as a minister in previous centre-left governments. Viewed as a bridge-builder, he is a nephew of Mr Berlusconi's long-time right-hand man, Gianni Letta.

The prime minister has said he wants to move quickly to tackle the economic problems plaguing Italy, the eurozone's third-largest economy.

The country is mired in its worst recession in decades and austerity measures pushed by the previous technocratic government led by Mario Monti have stirred anger across the nation.

The new government includes some of Mr Berlusconi's closest allies, including the secretary of his party Angelino Alfano, who will serve as interior minister.

Bank of Italy director general Fabrizio Saccomanni will take the powerful economy ministry and former European Commissioner Emma Bonino will be foreign minister.

Mr Letta (R) shakes hands with President Giorgio Napolitano

The third-largest force to emerge from the Italian election, the anti-establishment Five Star Movement led by comic Beppe Grillo, has demanded change and ruled out any alliance with the traditional political parties.

It will remain outside of the government.

Mr Grillo has said the coalition government "is an orgy worthy of the best bunga bunga" - a reference to Mr Berlusconi's infamous parties.

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