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No easy task for moderate Letta as Italy's next premier

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(Globalpost/GlobalPost)

By Gavin Jones

ROME (Reuters) - There is much about 46-year-old Enrico Letta, named as Italy's new prime minister designate on Wednesday, that is likely to please financial markets and Rome's international partners.

He is young, moderate and pro-European, and despite his low public profile he has been a member of the European political elite for many years. Letta speaks fluent English and has a sound grasp of economics.

He is the second youngest Italian prime minister since World War II, yet with his wire-rimmed glasses and a hairline that has been receding for at least a decade, he exudes gravitas and responsibility.

In accepting the job from President Giorgio Napolitano two months after February's inconclusive election he made no attempt to hide the difficulties ahead for a country mired in deep recession and led by a discredited political class.

"I feel a strong responsibility on my shoulders, stronger than my shoulders' ability to support it," he told reporters at the president's palace.

He said Italy's politicians had "lost all credibility" and appealed to the whole of parliament to back his reform efforts, including convincing the European Union to change the direction of policy which is "too focused on austerity".

Letta comes from the centrist wing of the centre-left Democratic party and has had a trail-blazing career since the early 1990s when he joined the defunct Christian Democrats (DC) who dominated post-war Italian politics.

At the age of 31 he was already deputy leader of the Popular Party, an offshoot of the DC, and when he became European Affairs minister in 1998 he was, at 33, the country's youngest post-war cabinet member.

He has always focused on EU affairs. In the 1990s he led a Treasury Ministry committee to prepare Italy's entry into the euro and served in the European Parliament from 2004 to 2006.

One of his tasks as prime minister will be to try to negotiate more budget flexibility for Italy from the EU, a position strongly supported by both the PD and Silvio Berlusconi's centre-right, who will be backing his government.

Letta, the PD's deputy leader, was picked by Napolitano as a centre-left figure who would be acceptable to Berlusconi in a broad, right-left coalition like the one that backed outgoing Prime Minister Mario Monti.

IN THE FAMILY

His uncle is Gianni Letta, Berlusconi's closest aide for over a decade. He succeeded Gianni as cabinet undersecretary when Romano Prodi beat Berlusconi at the 2006 election and the two men changed places again when Berlusconi won two years later.

Letta had been mentioned for several days as an outside possibility for prime minister, but Napolitano's favoured candidate was widely thought to be the 74-year-old former Socialist Prime Minister Giuliano Amato.

Letta's chances were seen as hurt by the collapse of the PD in the aftermath of the February election, when it won most seats but failed to secure a majority. PD leader Pier Luigi Bersani resigned as deep splits in the party emerged.

In the end Letta's youth and the fact that, unlike Amato, he was an elected politician may have tipped the balance. He will now need all his moderation and negotiating skills to keep his government afloat.

In an early sign of the challenges ahead, within minutes of Letta being summoned by Napolitano, Berlusconi was already laying down tough conditions to support his government.

His People of Freedom party called for the immediate abolition of an unpopular housing tax and the repayment to taxpayers of the 2012 levy, a measure which would put Italy's strained public finances under severe pressure.

Letta may also have to be wary of his own side. The PD has imploded into numerous warring factions and many in the party abhor the idea of collaboration the scandal-plagued Berlusconi.

On the more moderate side of the party the young Florence Mayor Matteo Renzi, widely seen as the PD's rising star and a potential rival, may not want Letta to have too much success.

Yet if he can navigate the obstacles and push through a reform of the electoral law and measures to help the economy, he has the credentials to be a dominant figure in Italian politics for the next decade.

(Editing by Giles Elgood)

http://www.globalpost.com/dispatch/news/thomson-reuters/130424/no-easy-task-moderate-letta-italys-next-premier