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Italy’s President Turns to Mario Draghi to Help Solve Political Crisis

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ROME— Mario Draghi saved the euro, but can he save Italy from political confusion?

Mr. Draghi has been called to see Italy’s head of state, President Sergio Mattarella, on Wednesday morning, and the expectation is that he will be asked to try to form a new government to steer Italy out of its health and economic crisis.

It is far from clear if a majority in Italy’s Parliament would support Mr. Draghi as prime minister, even if the former president of the European Central Bank signals that he wants the job. If a viable coalition emerges for Mr. Draghi to lead, his most urgent tasks would include formulating a strategy for economic recovery from the Covid-19 pandemic.

All of Europe has a stake in Italy’s economic fortunes, given the country’s teetering national debt and its electorate’s mixed feelings lately about the European Union and the euro. Germany and other EU members agreed to underwrite a massive pan-European recovery fund largely to prevent Italy from sliding into a deep slump. Italy’s economy contracted by nearly 9% in 2020, data released on Tuesday showed, one of the deepest declines in the eurozone.

President Mattarella invited Mr. Draghi on Tuesday after Italy’s left-leaning coalition government broke down and couldn’t be put back together again. That coalition, under Prime Minister Giuseppe Conte, collapsed partly over its inability to agree on how to escape a deep recession resulting from Covid-19 and lengthy lockdowns.

Italy’s pressing challenges mean it can’t afford a feeble government or months of delayed decisions while early elections are held, Mr. Mattarella said. “I appeal to all political forces in Parliament to support a high-profile government,” the president said.

People close to Mr. Draghi say he has been reluctant to enter the minefield of Italian coalition governments, which tend to be short-lived and fractious and whose collapses can tarnish the reputations of even highly esteemed leaders. But it is difficult to reject an appeal from the country’s head of state in the midst of a national emergency, these people say.

Mr. Draghi’s tenure as ECB chief made him one of Europe’s most respected public figures, at least within the continent’s broadly centrist, pro-EU political establishment, and with financial markets. His promise in 2012 to do “whatever it takes” to save the euro, including massive intervention in government bond markets, is widely credited with defusing Europe’s sovereign debt crisis, which threatened to tear the currency union apart.

However, Italian antiestablishment parties, such as the populist 5 Star Movement and the anti-immigration League, have long been skeptical of Mr. Draghi, seeing him as the epitome of the country’s technocratic elite, which they blame for Italy’s economic stagnation and social decay in the last quarter-century. Without the support of one or both of those parties, Mr. Draghi would struggle to find a majority with which to govern.

League leader Matteo Salvini on Tuesday repeated his call for snap elections, which opinion polls suggest his right-of-center alliance would win. However, other senior League politicians, including the party’s number two, Giancarlo Giorgetti, are known to support the idea of a broad-based coalition under Mr. Draghi.

The 5 Star Movement might not like Mr. Draghi, but the alternative of elections could be worse: Opinion polls point to heavy losses for the party, which has been the biggest source of support for Mr. Conte’s two governments since 2018.

Mr. Conte, a little-known law professor, lasted longer in power than most observers expected. But he fell out with a junior party underpinning his coalition, the centrist Italia Viva group led by former Italian Premier Matteo Renzi, who accused Mr. Conte of lacking ideas for how to revive Italy’s economy or spend the EU recovery funding productively. Mr. Conte said he was open to ideas from Mr. Renzi, but talks aimed at repairing the coalition broke down on Tuesday.

Write to Marcus Walker at marcus.walker@wsj.com and Giovanni Legorano at giovanni.legorano@wsj.com

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