Germany says hopes Italy will soon form 'stable government'

Germany says hopes Italy will soon form 'stable government'

With the vote count well advanced and full results due later on Monday, it looked nearly certain that none of the three main factions would be able to govern alone, and President Sergio Mattarella is not expected to open formal talks until early April.

Both Five Star and the emerging center-right coalition brokered by former Prime Minister Silvio Berlusconi are also proposing anti-EU economic policies to go with immigration reforms.

The League's economics chief on Monday raised the prospect of a ruling alliance with 5-Star, which would likely be eurosceptic and be little interested in further European integration.

Salvini criticised both the euro and European Union restrictions on national budgets.

The M5s came out as Italy's top party with 32% of the vote with over half ballots counted, about 2% more than it had been polling before the election.

A government led by extremist parties could prompt global investors to dump Italian government bonds, causing yields to rise sharply on its huge mountain of government debt worth around as €2.2 trillion euros or 133% of GDP at the end of 2017.

There is a long-standing crisis of elites in Italy, considered generally corrupt and inefficient, according to Leonard. He will choose someone to try to form a government as he cajoles former rivals to get over the rancour of the campaign.

But the process would take time as consultations could only start after parliament's newly-elected lawmakers meet for the first time on March 23 to elect speakers of the two houses of parliament.

"The vote has radically transformed Italy's political landscape and its repercussions will be long-lasting", Piccoli, the co-founder of the Teneo Intelligence consultancy, said. But the anti-establishment 5-Stars were the highest vote-getter of any single party, prompting their leader, Luigi Di Maio, to immediately assert his right to govern Italy.

Germany, on the other hand, struck a blow for normalcy, as coalition talks finally concluded and Merkel pledged to work with the "Social Democrats" for the good of Germany. As La Stampa splashed on its front page today: "Di Maio wins, Italy ungovernable".

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Tajani will now have to battle coalition partner Matteo Salvini, leader of the Northern League, for the leadership of the centre-right bloc and to be in a position to be nominated as Italy's next prime minister.

Borghi cited as an example the cancellation of a constitutional requirement to balance the budget.

"Keeping these promises would send the budget deficit over the 3 per cent limit", said Nobile, referring to the European Union budget rules that govern the single currency.

'While we are still optimistic on Italy's long-term fundamentals, the political trajectory of the country is a concern, particularly regards the potential push for increase fiscal spending from the increasingly more powerful right-wing parties, ' he said.

The League was particularly strong in the north, its traditional base. Its flagship proposal in the election campaign was a minimum monthly income of up to €780 for the poor, helping it draw overwhelming support in the underdeveloped south. A coalition of center-left parties led by PD had 25.5 percent of the vote.

"We did not anticipate this rationalization of the electorate". In the immediate aftermath of the vote, they still seem incompatible and the PD has said it plans to be in opposition. Renzi resigned as prime minister in December 2016. The bitter and divisive contest yielded no overall victor, but the swing towards populist extremist parties should be a concern.

As the results came in, French far-right leader Marine Le Pen celebrated, saying Europe was having a bad night.

Prominent British pro-Brexit figure Nigel Farage congratulated M5S, his allies in the European Parliament, "for topping the poll" as by far Italy's biggest single party.

"At least now there is a possibility for change", he said.

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