Berlusconi promises to resign amid Italy debt woes

ROME (AP) - Italian Prime Minister Silvio Berlusconi, Tuesday, admitted he has no support for the decision and announced his resignation as Greek partner, became the largest political victims in the European debt crisis.

Berlusconi promised to leave office after Parliament passed the economic reforms demanded by the EU to keep Italy from falling into debt problems in Europe. He came to the decision that the time after voting at a regular part of the law makes clear that he never commanded a majority in the Chamber of Deputies.

A vote on the proposed reforms planned for the next week, Berlusconi took a couple of days before his turbulent 17 years in public life - and the political season in Italy - the end. Over the years, witnessed the Italian political class as a magnate of the media who survived sex scandals and corruption charges, while his opponents brand communists, traitors and terrorists.

Italy and Greece are under pressure to convince financial markets that the euro zone from 17 nations to act quickly to reduce damage to government loans separately before they contaminate the monetary union and plunge into the world into a new recession.

In Greece, the Greek government official said the new interim government announced late on Wednesday after the critical power-sharing talks between the two major parties are dragging the country into a third day despite European pressure intense.

Both government approved the new package feed euro130 million (U.S. $ 179 billion) rescue with the new state of the European Parliament and end the political crisis that threatens the solvency of Greece and membership of the eurozone. Papandreou, son and grandson of Greek prime minister, do not get along.

European countries, including Germany and France are being redeemed rich Greek, Irish and Portuguese, Greeks, and receive an additional euro100 million ($ 138 billion) of debt relief as soon as they resolve the political crisis.

But as the third largest economy in the eurozone, Italy, to be around euro1.9 billion ($ 2,600,000,000,000), are now considered too big for Europe to rescue, putting more pressure on state leaders to convince the market that Italy and get home is in order.

The Italian lending rates jumped Tuesday at the highest level since the euro was established in 1999. Results in Italy of the 10-year bonds rose 0.24 percentage points to 6.77 percent. Rate of over 7 percent is considered unsustainable and demonstrate that the trigger points which forced Greece, Portugal and Ireland in receiving bailouts.

Berlusconi defied the usual acknowedged not have a majority in parliament and said he would step aside for the good of the country.

"The market does not believe that Italy is not, or with intent to pass the amendment," he told private Mediaset television. He added: "Things like that never lead to or cause the government" is more important to do "what is best for the country."

Waiver may not be enough. Political analyst Sergio Romano, a column on the front page of Corriere della Sera on Tuesday, warned that unless the program is clearly emerging in the post-Berlusconi "foreign observers to conclude that the end does not goverenment to the arrival of Berlusconi's government, more credible confidence. "

Italy accounts for 17 percent of domestic product, the euro zone as well. But most of its debt must be rolling in the coming months and years, the country needs to increase the euro300 million ($ 412 billion) in 2012 alone - as interest rates soared.

Berlusconi took steps last week to ask embarrassing the International Monetary Fund to continue the efforts to reform the country in a bid to reassure markets. On Wednesday, a European Union mission is monitoring a separate to begin work in Rome to examine the measures taken so far.

Questionnaire of the European Union, Italy stood in front of the mission, said that additional steps beyond what Italy has promised to do to balance the budget by 2013, according to the text that appears on Italian television.

When Berlusconi resigned, Italian President Giorgio Napolitano will begin political consultations to form a new government. Name the most discussed government is led by Mario Monti, former commissioner of EU competence.

The development of seizures in the market is closed today and the House of Representatives. At least regular budget vote in an internal test support for Berlusconi, prime minister of collecting 308 votes of approval and none against. However, the 321 deputies abstained, a tactic that revealed the recession continues Berlusconi.

Berlusconi margin of eight votes of 316 needed to win an absolute majority in the House of 630 members.

"The government is no longer the" Cries of Pierluigi Bersani opposition leader. "If you have a sense of particles in the face of Italy, offering a letter of resignation!"

Talk Like Bersani, Berlusconi has chosen to write on a sheet of paper. An AP photo showed writes "resignation" and also "the traitorous eight," apparently referring to a former ally who abstained.

After business leaders enthusiastically support the leadership of the media mogul, but now some say the government has failed to stimulate the Italian economy stagnated.

"The state can not survive in these conditions," said Emma Marcegaglia, who led the influential Italian business lobby.

January Randolph, head of sovereign risk analysis at IHS Global Insight, said Berlusconi's resignation brings brief relief rally in the market.

"But Italy is not out of the bond market will heat up a solid and stable government, the actual implementation of agreed reforms and saving for a strong credible leadership," said Randolph.


Gatopoulos reported from Athens. Colleen Barry in Milan, Frances D'Emilio in Rome and Gabriele Steinhauser in Brussels contributed.

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