Italy told to meet austerity target
European Central Bank chief Jean-Claude Trichet has told Italy it is "essential" to promptly implement its deficit-reducing measures if it wants to preserve its credit worthiness.
Premier Silvio Berlusconi's government has been squabbling for weeks over proposed new taxes and spending cuts to achieve a 45.5 billion euro (£38.2 billion) austerity package, which Parliament must approve later this month.
"It is essential that the target which was announced to diminish the deficit will be fully confirmed and implemented," the ECB president said at an economic forum in Cernobbio, a Lake Como resort. "This is absolutely decisive to consolidate and reinforce the quality and the credibility of the Italian strategy and its credit worthiness."
The outgoing central banker deemed as "extremely important" all measures to improve the "flexibility" of Italy's economy. Both industrialists and union leaders have denounced the austerity plan as relying too much on cuts and taxes and offering little to stimulate the country's practically flat growth or to create jobs.
Italian President Giorgio Napolitano echoed Trichet's call to his country, saying the proposed measures must be quickly "translated into concrete terms" to achieve Berlusconi's goal of balancing the budget by 2013.
Mr Napolitano urged the government to be "coherent and courageous" in meeting the economic crisis.