Italian Prime Minister Giuseppe Conte gestures as he delivers a speech at the Italian Senate, in Rome, on August 20, 2019, as the country faces a political crisis.
Andreas Solaro | AFP | Getty Images
Italian Prime Minister Giuseppe Conte was given a mandate to form a new government Thursday, as the opposition Democratic Party (PD) set aside its differences with the anti-establishment Five Star Movement (M5S) to form a new left-leaning coalition.
Conte announced his intention to resign last week after a rocky power-sharing agreement between M5S and the right-wing Lega fractured. But following consultations with Italian President Sergio Mattarella, M5S came to a new arrangement with PD on Wednesday evening. On Thursday morning, Mattarella met with Conte and handed him a fresh mandate to form a government, according to a presidential official, which would allow him to stay on as Italian leader.
Conte had been put under pressure by Matteo Salvini, a former deputy prime minister who leads the Lega party, and called for a snap election earlier this month. Salvini declared the populist coalition government unworkable and called for a no-confidence vote in Conte.
Conte is a law professor who was appointed by both the M5S and Lega parties last year but is not affiliated with either. Italy — the third largest euro zone economy — had been governed by the two-party coalition since elections in March 2018 yielded no outright winner in Rome. This coalition had been on a rocky path since it came to power. Some of the tension had been caused by government appointments, the country’s relationship with the European Union, and, more recently, a high-speed rail link.
In the last week investors have cheered the prospect of this new coalition being formed between two parties from the political left: the populist M5S and the more European-friendly PD. Italy’s FTSE MIB climbed 1.2% on Thursday morning on the political developments.
—CNBC’s Silvia Amaro contributed to this article.
