Rome: Silvio Berlusconi resigned on Saturday to make way for an emergency government Italians hope will save them from financial ruin as thousands of jeering protesters shouted "clown, clown" and toasted the end of a scandal-plagued era.
Berlusconi, who failed to secure a majority in a crucial vote on
Tuesday, stepped down as prime minister after parliament passed a package of
measures demanded by European partners to restore market confidence in Italy's
strained public finances.
Former European Commissioner Mario Monti is
expected to be given the task of trying to form a new administration to face a
widening financial crisis which has sent Italy's borrowing costs to unmanageable
More than a thousand demonstrators waving banners mocking
Berlusconi flocked to the president's residence at the Quirinale Palace as the
motorcade carrying the billionaire media entrepreneur, who has been Italy's
longest serving prime minister, entered.
The crowd grew so unruly that
Berlusconi was forced to leave secretly via a side entrance and return to his
Cheers broke out when they heard that Berlusconi had
resigned and the square broke out into a party atmosphere. People sang, danced
and some broke open bottles of champagne.
An orchestra near the palace
played the Hallelujah chorus from Handel's Messiah. "We are here to rejoice,"
Demonstrators chanting "resign, resign, resign" also gathered
outside the prime minister's office and parliament, heckling ministers as they
walked between the two buildings.
A small group of pro-Berlusconi
demonstrators gathered outside his residence but were hugely outnumbered by
After the resignation, hundreds shouting "Jail, Jail,
Jail,"moved from the presidential palace to Berlusconi's residence to continue
the noisy celebrations below his windows.
"This is something that deeply saddens me," the Italian news agency Ansa
quoted Berlusconi as telling aides.
President Giorgio Napolitano will
begin consultations with political leaders at 5:00 a.m. EST on Sunday morning.
He was expected to ask Monti for form a government on Sunday night.
Italy, the euro zone's third largest economy, came close to disaster
this week when yields on 10-year bonds soared over 7.6 percent, the kind of
level which forced Ireland, Portugal and Greece to seek international bailouts.
Berlusconi, who failed to secure a majority in a vote on Tuesday,
promised to resign once parliament passed the package of economic reforms
demanded by European partners to restore confidence in Italy's battered public
Monti, named by Napolitano as a Senator for Life on Wednesday, is
expected to appoint a relatively small cabinet of technocrat specialists to
steer Italy through the crisis.
With the next election not due until
2013, a technocrat government could have about 18 months to pass painful
economic reforms but will need to secure the backing of a majority in parliament
and could fall before then.
With a public debt of more than 120 percent of
gross domestic product and more than a decade of anemic economic growth behind
it, Italy is at the heart of the euro zone debt crisis and would be too big for
the bloc to bail out.
Financial markets have backed a Monti government and
as prospects of Berlusconi going became firmer last week, yields dropped below
the critical 7 percent level, although they remain close.
"We don't yet have a new government in Italy and we have to wait, but I'm
sure if Mario Monti will be appointed he will do whatever is necessary in order
to restore the confidence of the financial markets in Italy," Alessandro
Profumo, former head of Unicredit, Italy's largest bank, said.
Berlusconi, fighting an array of scandals and facing
trials on charges ranging from tax fraud to paying for sex with an under-aged
prostitute, had been under pressure to resign for weeks as the market crisis
threatened to spin out of control.
International leaders including U.S.
President Barack Obama, French President Nicolas Sarkozy and the head of the
International Monetary Fund Christine Lagarde have expressed hopes a new
government can be in place quickly.
Talks with Italian political parties are
expected to begin on Sunday with hopes that a new government can be in place in
time for the opening of financial markets on Monday.
However, even as
preparations for a transition begin, signs of opposition have appeared, with
Berlusconi's PDL party split between factions ready to accept a Monti government
and others deeply opposed.
Berlusconi had a working lunch with Monti before
the vote, suggesting the outgoing government will not try to block a quick
handover, but the attitude of the center-right as a whole remains unclear.
The PDL's main coalition ally, the regional pro-devolution Northern League,
has declared it will go into opposition, underlining the risk that the new
government will lack the broad parliamentary support it will need to pass deep
"The convulsions in the center-right at the prospect of a
government led by Mario Monti signal a danger: that a divided coalition may be
tempted to unload its divisions on the country," the daily Corriere della Sera
The center-left Democratic party and smaller centrist parties have
pledged support to Monti. Italy's main business and banking associations and
some of the moderate trade unions have also called for a government of national
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