Giuseppe Conte addresses the media after he talks with Italian President Sergio Mattarella in Rome, Italy, on Sept. 4, 2019. The last major hurdle that could have blocked Giuseppe Conte from forming Italy's 67th government since World War II has disappeared, after the populist Five-Star Movement overwhelmingly voted Tuesday for the party's coalition with a political rival. (Photo by Alberto Lingria/Xinhua)
ROME, Sept. 5 (Xinhua) -- The new slate of ministers for Giuseppe Conte's second stint as Italy's prime minister appears to put the country on a pro-European Union course, something already being applauded by economic observers.
The new ministers were formally sworn in on Thursday by Italian President Sergio Mattarella.
Conte's choice for his cabinet is a clear indication of the priorities for the new government, backed by an unlikely coalition between two rival parties -- the populist, anti-establishment Five-Star Movement and the center-left Democratic Party.
The most important ministerial pick was Roberto Gualtieri, a member of the Democratic Party, as Minister of Finance. Gualtieri has been a member of the European Parliament for the last ten years, including stints on several key security and budget committees.
"The selection of Gualtieri will help calm markets that would have reacted badly to a figure more likely to clash with the European Union," Hildebrandt and Ferrar chief economist Javier Noriega told Xinhua. "I am sure there was also a lot of relief at the European Commission in Brussels."
At least based on first-day indications, Noriega was right. The Italian Stock Exchange in Milan closed 1.6 percent higher after Gualtieri's name leaked. The yield on Italy's ten-year government bonds fell by 7 points, nearly a 7.5-percent decrease compared to the previous trading day, a reflection of growing investor confidence.
The two parties' joint 26-point program prioritized an expansionary budget for 2020 but avoided alarm bells by also promising to avoid risks to public finances.
In a note released after Wednesday's developments, the rating agency Standard & Poor's said the new government "could pave the way for important policy adjustments, including critical budgetary plans."
Analysts said the selection of Gualtieri -- along with some non-minister announcements, such as the selection of former Prime Minister Paolo Gentiloni as Italy's representative on the European Commission -- could help convince commissioners to give Italy more flexibility on economic matters.
Among them are the deficit level in the 2020 budget and possibly a delay in the automatic increase in the country's value-added tax now scheduled to enter into force Jan. 1, 2020.
"I think the impression is that this new government will bring more stability to Italy," Emiliana De Blasio, a professor of communications sociology at Rome's LUISS University, said in an interview. "It would not be surprising for the European Commission to support a government like that."
The new cabinet will include ten members of the Five-Star Movement, nine from the Democratic Party, one from the second-tier Free and Equal party, and one unaffiliated technocrat.
The addition of Free and Equal's Roberto Speranza as Minister of Health is an indication his party will be a junior member of the coalition. That adds four Senators to those from the Five-Star Movement and the Democratic Party, giving the Conte government a two-seat Senate majority if everyone votes along party lines. The two main parties already had a comfortable majority in the lower house of parliament.
Luciana Lamorgese, the government's lone technocrat, is also a significant addition to the cabinet. Lamorgese, a career civil servant, will replace Matteo Salvini as Minister of the Interior.
Salvini -- head of the anti-migrant League, now the leading opposition party -- used his ministerial position to implement Europe's most restrictive migration laws, reducing the numbers of would-be asylum seekers on Italian soil to a trickle. Analysts said the appointment of Lamorgese will likely result in a softening of Italy's policies in this area.
Dario Franceschini, a former head of the Democratic Party, will return to the Ministry of Culture post he held from 2014-2018. Franceschini helped modernize Italy's museums by allowing non-Italians to apply for jobs as museum directors, something Salvini's League had all but phased out.