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Mario Draghi, eurozone saviour, now called to Italy's side

Brigitte HAGEMANN, Alexandria SAGE
·3-min read
Under Maario Draghi's leadership, the ECB took measures unthinkable when the euro single currency was launched in 2000

Mario Draghi, who as European Central Bank chief was credited with saving the eurozone in 2012 at the height of the debt crisis, has now been tapped to help one of its weakest links, Italy.

The Italian economist was asked Wednesday by his country's president to form a government following the collapse of outgoing premier Giuseppe Conte's coalition.

He agreed to try during what he called "a difficult moment" for Italy, as the eurozone's third largest economy faces the ongoing coronavirus emergency and a punishing recession.

The central banker dubbed "Super Mario" may be the man for that moment.

"Whatever it takes," is the famous phrase defining his turbulent period at the ECB, calming markets in 2012 with his pledge to do the maximum to save the euro.

Seven years later, he handed the reins of the ECB to Christine Lagarde, telling France's ex-finance minister to "never give up".

- No walk in the park -

Draghi's name had been circulating for weeks as a top choice for leading Italy out of its current political crisis, sparked when a small party pulled out of Conte's ruling coalition.

Experts cited Draghi's experience, professionalism and determination as crucial attributes for a so-called "technocratic" government led by a non-politician, but conceded that wrangling Italy's warring parties to get behind him will not be easy.

"Mastering enough support over the next few days will not be straightforward," said Lorenzo Codogno, an economist and consultant with LC Macro Advisors.

"It will not be a comfortable journey, but Draghi's skills and experience may well do the trick."

Draghi was named to head the ECB in November 2011, succeeding Frenchman Jean-Claude Trichet in a eurozone shaken by the debt crisis.

The threat of the bloc's implosion hung over his tenure, alongside worries that the sovereign debt crisis in Greece would spread to other countries.

But under Draghi's leadership, the ECB took measures unthinkable when the euro single currency was launched in 2000: cutting interest rates to negative territory, and injecting liquidity into the markets through massive asset repurchases.

- Banker to premier? -

Draghi was born in Rome on September 3, 1947, and is married with two children.

He holds a degree in economics and a doctorate from the Massachusetts Institute of Technology (MIT) and is an economics professor at several Italian universities.

After spending six years at the World Bank from 1984 to 1990, he became director general of the Italian treasury in 1991, a position he held for a decade under nine separate governments, masterminding a number of privatisations.

In 2002, he joined the management of Goldman Sachs before being tapped three years later to lead the Bank of Italy after a scandal involving its former head, Antonio Fazio.

News of Draghi's expected appointment was well-received by the financial market on Wednesday, with the Milan stock exchange rising three percent in midday trading, as he met Mattarella.

Before launching into a series of meetings with the parties on Wednesday, the would-be prime minister expressed determination to find a way forward.

"I am confident that from talks with parties, the parliamentary groups and unions, unity will emerge," he said.