Italian Prime Minister announces resignation

On December 8, Italian Prime Minister Mario Monti informed the country's president that he would soon resign, after former Prime Minister Silvio Berlusconi's party withdrew from the ruling coalition.

The move could pave the way for an early election a year after unelected economist Monti helped Italy escape a financial disaster.

Italian Prime Minister Mario Monti - photo: telegraph.co.uk

News agencyAPHours earlier, Mr Berlusconi had announced he would run for a fourth term as prime minister after resigning amid scandal in November 2011.

President Giorgio Napolitano met with Mr Monti for nearly two hours and afterwards the president's office said the prime minister had confirmed that without Mr Berlusconi's support, "he could no longer carry out his duties and had decided to resign". However, Mr Monti was still waiting for the Italian parliament to pass a key budget bill before stepping down.

Italy's political crisis threatens to deepen the country's already strained financial situation. Credit rating agency Standard & Poor's said on December 7 that it could downgrade Italy again in 2013 due to "uncertainties" facing the country's government and the austerity package that Monti's government is trying to push through parliament.

Monti, an economist appointed by Napolitano a year ago to head Berlusconi's unelected government, will be nominated by Berlusconi's political rivals, the centre-left Democratic Party, Pier Luigi Bersani, as his candidate for prime minister. Bersani has criticised Berlusconi's withdrawal of support for the current government as "irresponsible" and a "betrayal of the pledge he made to the nation a year ago" to back Monti.

Explaining the withdrawal, Berlusconi's party secretary, Angelino Alfano, criticised the Monti government's focus on austerity packages and said that strategy was not enough to revive the economy.

According to Tuoitre-M