Monti : Italy austerity may have saved eurozone

Italian Prime Minister Mario Monti on Saturday defended the biting austerity measures imposed during his first year in power, saying without them the eurozone might have broken up or collapsed altogether. "Perhaps today, without the austerity measures brought in by the government, the eurozone would be no more," the premier's office said in a 17-page round-up marking one year since Monti took over leading a debt-laden Italy. "Or it (eurozone ) would be notably smaller in geographical terms without that which Italy, in a collective effort that does not have many precedents in the history of the republic, has been able to carry out," the statement added. Monti, a former economics professor and high-flying European commissioner, was voted in by parliament as the head of a technocratic government on November 16 last year as Italy came under fire from the eurozone debt crisis. "This government was born on the wave of an emergency, faced with a dramatic decision: to let the country sink or force it to get out of the swamps." The measures eased interest rates and reassured skittish markets alarmed at the size of Italy's debt that the eurozone's third largest economy was not going to be the catalyst that brought down the single currency, it said. Monti, whose popularity has been hit by the austerity packages and structural reforms that critics say are impeding growth, admitted that the government could have done more, particularly for Italy's poorest citizens. "Clearly, it would have been necessary to do more, and perhaps some errors were made. Much more could have been done in favour of the most needy classes." The country entered into a recession at the end of last year and jobless rates particularly among the young have soared, sparking a series of protests. However, Italy has recovered respect on the international stage since Monti's appointment and "is once more an active and proactive (EU) partner, a protagonist in strategic and operational decision-making," the statement said. The one-year anniversary of the Monti government has seen supporters speak out in favour of the premier staying on after elections in spring 2013. The idea is particularly popular in business circles where many agree he has restored Italy's credibility after Silvio Berlusconi was forced out in late 2011 by a parliamentary revolt, a series of scandals and panic on the markets. Luca Cordero di Montezemolo, the head of luxury car maker Ferrari and a former leader of Italy's big business federation, is to launch a new political movement on Saturday which will push for Monti to stay on as prime minister.