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Italy's populists storm to centre stage in general elections

06 March 2018

A ballot is put into the box on Sunday.

The math added up to big dilemma, though.

The Euroskeptic, anti-establishment Five Star Movement was the biggest single victor with about a third of the vote, though it will not have enough seats to form a government.

"The (next) government is an enigma", read the front-page headline of the daily Corriere della Sera.

The 5-Star Movement, founded by an Italian comedian just nine years ago as an online-driven grassroots revolt against Italy's political establishment, was the biggest victor in Sunday's election, capturing about one-third of the vote.

Some pollsters say the League could overtake Berlusconi's Forza Italia party on Sunday. After that, Italian President Sergio Mattarella will consult with party leaders to figure out which coalition alternative has the highest chances of surviving a confidence vote.

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In Italy, the Democratic Party's (PD) woes were exacerbated after leader Matteo Renzi attempted to bring about major constitutional reforms that would have further centralised powers - efforts that were resoundingly rejected in a referendum in 2016, forcing Renzi's resignation as Prime Minister. Now, it's shaping up to be the largest opposition party in Parliament. That system crumbled in the early 1990s amid corruption scandals that swept away virtually an entire political class. "For all the public flirting with Euroscepticism and populism, Italian governments have caused the European Union fewer problems than France or the Netherlands, let alone the United Kingdom".

5-Star Movement leader Luigi Di Maio talks during a news conference, the day after Italy's parliamentary election, in Rome, Italy March 5, 2018.

But how that new era will take shape is very unclear. Now, ineligible to be premier due to a tax fraud conviction, Berlusconi, 81, could be eclipsed by the brash Salvini.

The League is closing in on 18 percent, overtaking the pre-election coalition leader and media mogul Silvio Berlusconi's Forza Italia (Go Italy) party, which has collapsed to 14 percent. No political party won enough seats in Parliament to claim a majority, meaning that Italy's politicians will be forced to launch negotiations to form a governing coalition.

The solution feared most by markets is a marriage between 5-Star and League.

Zangana said a government led by the League - which has transformed from a separatist regional party to a far-right, anti-immigration, eurosceptic party - would "concern many" as its coalition would also include hard-right nationalist party Brothers of Italy.

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'Now, however, it looks increasingly unlikely that populist parties, and Five Star in particular, can be left out of a broad coalition given the election result.

"We will work to modify and remove some European parameters, but regarding the euro I remain convinced that the single currency is destined to end, not because I want it but because the facts, common sense, and the real economy dictate it". For now, he excluded the possibility of the Democrats joining any government led by the League or the 5-Stars.

The brainchild of comedian Beppe Grillo, the 5-Star Movement was long considered an itchy thorn in the EU's side at best, a droll antidote to the sometimes deadening debate at the European Parliament.

The M5S scored a "triumph" thanks to "11 million Italians" and is ready to "talk to all parties" on its government agenda, Di Maio said. The share of the vote for prime minister Matteo Renzi's party fell to less than 20%, compared with 26% in 2013.

He added that "of course contact will be established with the next Italian government, whatever its makeup".

The 5-Star, led by 31-year-old Luigi Di Maio, has been particularly successful at tapping into the disaffection in the underdeveloped south and has promised a monthly universal wage of up to €780 for the poor.

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A government led by extremist parties could prompt global investors to dump Italian government bonds, causing yields to rise sharply on its huge mountain of government debt worth around as €2.2 trillion euros or 133% of GDP at the end of 2017. "It was already discounted that neither party nor coalition would reach 40%, so the negative suprise is moderate".