The Straits Times
Published on Dec 10, 2012

Europe hails "great" Monti as Italy crisis hits markets


ROME (REUTERS) - European partners heaped praise on outgoing Italian Prime Minister Mario Monti on Monday, and called for the next government to stick to his reform agenda after his surprise decision to resign rattled financial markets.

Mr Monti's weekend announcement that he would step down early - made after former Prime Minister Silvio Berlusconi's PDL party withdrew its support for his technocrat government - pushed up Italy's borrowing costs and prompted a stock market sell-off.

The campaign for an election expected in February is likely to be fought over Monti's reform agenda, which Mr Berlusconi said had condemned Italy to recession and forced him reluctantly to run for a fifth term as prime minister.

By contrast, senior Europeans warned that Mr Monti's policies must continue to prevent a return of the crisis which brought him to power a year ago to avert a Greek-style collapse.