Italy's crisis eases as ex senator chosen to form new government

A COMPROMISE choice, Mr Antonio Maccanico (71), a former senior civil servant and former Republican senator, was yesterday chosen…

A COMPROMISE choice, Mr Antonio Maccanico (71), a former senior civil servant and former Republican senator, was yesterday chosen to form Italy's 55th post war government.

His appointment should thus end a month long crisis prompted by the resignation on December 30th of former banker, Mr Lamberto Dini, whose so called "government of technicians" had been in office since January of last year.

Mr Maccanico's mandate is to form an all party government will not only guarantee political stability in the short term but which will also embark on a programme of electoral and institutional reform. If he manages to get such a government up and running, then it may be in office for up to two years, the time necessary to enact complex reforms.

His task will not be simple since, while there is widespread party agreement on the need for radical reforms in the interests of guaranteeing both stable and lasting government there is as yet no detailed agreement on the precise nature of such reforms.

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For the time being, the centre left and centre right power blocks have merely agreed to consider reforms modelled on the French presidential system, without, however, spelling out the division of powers between president, prime minister and parliament.

While the political parties are fed up with being shut out of office by the anomaly of Mr Dini's technical government, a majority of them are unwilling to resolve the current uncertainty with a general election.

Thus Mr Maccanico has emerged as a compromise choice, faced with an ill defined mission the success of which is by no means guaranteed. Given the bitterness of exchanges between the two major power blocks over the last 12 months, Mr Maccanico may face an impossible task in heading a joint centre right centre left executive.

In choosing Mr Maccanico President Oscar Luigi Scalfaro was clearly swayed by his track record in institutional reform. Mr Maccanico's previous government experience includes a spell as Minister for Regional Affairs and Institutional Reforms from 1988 to 1991 in the governments of Christian Democrats Mr Ciriaco De Mita and Mr Giulio Andreotti, while he also served as cabinet secretary to the year long 1993 government of former Bank of Italy governor, Mr Carlo Azeglio Ciampi.

In outlining his government priorities, Mr Maccanico highlighted constitutional and institutional reforms, aimed at changing Italy's current 75 per cent majority vote system as well as setting up some form of regional assembly which may well replace the current Senate.

Mr Maccanico committed himself to furthering the policies of strict budgetary control pursued by the Amato, Ciampi and Dini governments prior to him, adding that a rapid return of the lira to the EU's Exchange Rate Mechanism and lower inflation were among his priorities.

With regard to Italy's current term of European Union Presidency, the prime minister designate underlined the need for Italy to play an incisive role, with particular reference to the Turin Intergovernmental Conference of March and to controversial questions such as the single European currency and common EU policies on Defence, Justice and Foreign Affairs.

Not surprisingly, the most negative reaction to the designation of Mr Maccanico came from Mr Romano Prodi, the man expected to lead the centre left "Olive coalition in any forthcoming general election. He accused his major supporters, the ex communist Democratic Left Party (PDS) as well as Mr Silvio Berlusconi's right wing Forza Italia party, of having blocked the creation of a truly bipolar electoral system for reasons of mutual expediency.

A more positive reaction came from share and currency markets, with Milan's Mibtel all share index gaining 1.49 per cent and with the lira gaining 9.98 points on the deutschmark, to close at 1063. Those figures reflect the business community's belief that an immediate general election would have had a negative effect on the Italian economy.