ROME • Italian President Sergio Mattarella has asked economist Carlo Cottarelli to form a new government as populist leaders railed against the President and EU for blocking their bid for power.
With fresh elections due as early as September, Mr Cottarelli, 63, yesterday said Italy will stay in the euro zone as he called for a "constructive dialogue" with the European Union.
He said: "The President has asked me to go before Parliament with a programme that will bring the country to new elections."
The former executive director of the International Monetary Fund said elections could be held after August if his government loses a parliamentary vote of confidence, or early next year if it wins a ballot in the Lower House and Senate.
The choice of Mr Cottarelli - known for his strict approach to state finances - for the role of caretaker prime minister will further inflame Italy's bitter political divisions. Populist leaders slammed Mr Mattarella for the collapse of their planned government, and sought to extend the blame to the EU.
Markets gave up earlier gains as the Five Star Movement and the League raged against Mr Mattarella, suggesting that there could be months of acrimonious political campaigning ahead.
The populists said Mr Mattarella gave in to pressures from investors and countries like Germany when he decided to veto their decision to appoint the eurosceptic economist Paolo Savona as finance minister.
Both the anti-establishment Five Star and the anti-immigrant League rejected Mr Cottarelli even before he was given a mandate. Five Star said it was considering proposing impeachment proceedings against Mr Mattarella, while the League's Mr Matteo Salvini called for elections "as soon as possible".
Mr Mattarella chose EU rules over the votes of Italians and that's "an issue for democracy", Mr Salvini said in a post on Facebook. Either EU rules change or it makes no sense for Italy to remain a member of the bloc, he added.
Asked if he would ally himself with Five Star in a new election campaign, Mr Salvini said he was "still too angry" to discuss this.
Dr Rosamaria Bitetti, a lecturer in public policy at Rome's Luiss University, said: "Mattarella's choice delays risk but may lead to stronger populist sentiment at the next elections, which is worrisome. People voted for these parties, and it may be hard to explain to them why they can't have their government."
French President Emmanuel Macron yesterday praised Mr Mattarella for rejecting a proposed government by coalition parties - and a eurosceptic nominee for finance minister.
Germany has adopted a wait-and-see attitude. Chancellor Angela Merkel's spokesman, speaking to reporters in Berlin, said: "The government hopes, in the interests of our close European partner Italy, for a stable government."
Nicknamed "Mr Scissors" for his strict approach to state finances, Mr Cottarelli refused the use of an official car when he was appointed commissioner for a review of public spending in 2013 under then premier Enrico Letta.
BLOOMBERG, AGENCE FRANCE-PRESSE
