Mario Draghi Named Italy’s Prime Minister Amid Crises
Former ECB chief unites Italy’s fragmented political landscape
Mario Draghi, the former head of the European Central Bank, has been named Italian prime minister after persuading nearly all of the country’s squabbling parties to support his government, raising hopes that he can succeed where many others have failed: in leading Italy out of its deep economic malaise.
Italy’s head of state, President Sergio Mattarella, appointed Mr. Draghi and his proposed ministers late Friday, ahead of a formal swearing-in to be held the following day and a parliamentary vote of confidence early next week.
Mr. Draghi is set to take over the European Union’s third-biggest economy after Germany’s and France’s as Italy fights with persistently high Covid-19 contagion, an agonizingly slow vaccine rollout and restrictions on daily life that are holding the economy in recession.
Reviving economic growth in Italy is vital for the EU and its common currency, the euro, since Italy’s deep debts and chronically low growth are the biggest sources of doubt about the euro’s long-term stability. How to reanimate Italy’s economy, which has stagnated since the 1990s, has bedeviled a series of would-be reforming leaders who briefly carried the country’s hopes but ended as disappointments.
Mr. Draghi, a 73-year-old, U.S.-trained economist who has worked at the World Bank, Goldman Sachs Group Inc. and Italy’s Treasury and central bank, will have at most two years to make a difference. Italian parties will return to competing for power in parliamentary elections by 2023 at the latest.
He brings two main assets to the task: his reputation in Italy and the EU for both economic expertise and diplomatic deftness, based on his successful handling of the eurozone debt crisis when he was ECB chief; and the pot of money that the EU has promised Italy to support its economic recovery.
As ECB chief in 2012, Mr. Draghi defused a sovereign-debt crisis that threatened to destroy the euro by pledging to do “whatever it takes” to stabilize panicking bond markets, after quietly negotiating political support from key EU leaders and sidelining opponents.
“I graded his performance as straight A,” U.S. Treasury Secretary Janet Yellen, who as Federal Reserve chairwoman dealt often with Mr. Draghi, told The Wall Street Journal in a 2019 interview.
“‘Whatever it takes’ will go down in the annals of central banking history as one of the most important interventions ever. It’s hard to imagine where we would be without it.”
https://www.wsj.com/articles/mario-draghi-to-take-over-as-italys-prime-minister-amid-economic-covid-19-crises-11613132691