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Berlusconi Wins Third Term as Italy's PM

Reuters
Monday, 14 Apr 2008 | 7:00 PM ET

Conservative billionaire Silvio Berlusconi won a third term as Italy's prime minister on Monday with an unexpectedly strong mandate for reform, but warned of tough times ahead for a country facing deep economic problems.

Center-left rival Walter Veltroni conceded defeat when early results from a two-day election showed the 71-year-old media magnate Berlusconi would control both houses of parliament.

This should enable him to push reforms through parliament, unlike his predecessor, but many Italians are disillusioned with politics and doubt any government can quickly cure the ills of the European's Union's fourth-largest economy.

"The months and years ahead will be difficult," Berlusconi told state television in a live phone call.

But referring to two issues that symbolize Italy's political and economic stagnation, he vowed: "We'll strive to resolve immediately the garbage crisis and Alitalia's problems."

Unions are blocking Air France-KLM's bid for the loss-making Italian airline and garbage piled up this year in the streets of Naples before being cleared for the election.

Berlusconi, who has vowed to cut taxes and rein in Italy's huge debt, had been widely expected to win a clear majority in the lower house but not in the Senate.

Pollsters' projections, based on partial results, gave Berlusconi a 99-seat majority in the 630-member lower house and an advantage of up to 30 seats in the Senate, which has 315 elected and seven lifetime senators.

That contrasts with the two-seat Senate majority that the last government had under Romano Prodi, who resigned in January just 20 months into his five-year term. Berlusconi had set his sights on a 20-seat majority in the Senate.

Veltroni, the 52-year-old former Rome mayor, called Berlusconi to "wish him luck". His Democratic Party performed solidly but Prodi's former hard-left allies were in danger of not winning a single seat.

Political Watershed

Berlusconi's pledges include liberalizing the economy as well as getting tough on crime, but critics say he failed to carry out pledges to revolutionize Italy when prime minister for seven months from April 1994 and from 2001-2006.

His far-right allies in the anti-immigrant Northern League made gains and their outspoken leader, Umberto Bossi, who often threatens to take up arms, will seek to influence the next government.

The election could mark a watershed in Italian politics, with a handful of parties winning seats rather than more than 20 in the last election. Christian Democratic chief Pierferdinando Casini said the next parliament may have only five parties.

Political analyst Roberto D'Alimonte said this would turn Italy into a "normal" European country, "with just two main parties accounting for over 70 percent of the vote".

Many Italians went to the polls to elect their 62nd government since World War Two gloomy about chronic political instability and an economy that has long lagged behind its main partners in the EU.

JP Morgan economist Silvia Pepino described Italy's economic problems as "very long-standing and deep-rooted and it's difficult to see any progress in the near term whatever the outcome of the election."

Economic growth is expected by the International Monetary Fund to slow to 0.3 percent this year and Italy's debt is the third highest in the world.

Berlusconi dominates Italian media through his business empire, Mediaset, Italy's largest private broadcaster, and is rated the country's third richest man by Forbes magazine.