Italy’s PM Defies Critics, Support Waning

Posted November 4th, 2011 at 9:55 pm (UTC-5)
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Italian Prime Minister Silvio Berlusconi is defying critics despite a rebellion in his own party over the economic crisis that has brought his center-right coalition to the brink of collapse.

Mr. Berlusconi insisted Friday that his government still has a solid majority in parliament and that his cost-cutting measures will pass the vote in the Italian Senate.

But news reports from Italy say that two members of the ruling PDL party defected to the centrist UDC, which is not a part of Mr. Berlusconi's coalition and several others have signaled they could vote against him.

The economic crisis in Italy prompted G20 leaders to impose international monitoring of Italy's implementation of its austerity measures to keep it from needing a bailout. Italy's fate in is crucial to the eurozone, because its economy is the third-largest in the 17-nation currency union and would be too expensive to bail out.

President Giorgio Napolitano said Friday that a serious crisis of confidence has emerged toward Italy in Europe and beyond and that the situation demands a determined response.

Mr. Berlusconi had promised that his country would reduce its public debt of $2.6 billion by 2013, but his government has been slow at implementing unpopular economic reforms. The country's public debt is equivalent to 120 percent of gross domestic product while its economic growth remains sluggish.

In the wake of Greece's financial collapse Italy's borrowing costs have increased, reaching almost 6.5 percent Friday.