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UPDATE 4-Italy cabinet nominates EU Minister Savona as market watchdog chief

Updated: 05-02-2019 21:08 IST
UPDATE 4-Italy cabinet nominates EU Minister Savona as market watchdog chief

The Italian cabinet on Tuesday nominated 82-year-old euro-sceptic EU Affairs Minister Paolo Savona as the next head of Consob, the country's market watchdog, but the opposition said the proposed appointment was illegitimate. The proposal will now be reviewed by a parliamentary commission and must ultimately be approved by President Sergio Mattarella, who last year refused to let Savona become economy minister because of his anti-euro views.

However, a source in the president's office told Reuters earlier on Tuesday that Mattarella would not object to Savona's moving to Consob if the nomination overcame various legal hurdles that could yet derail his candidacy. The opposition Democratic Party (PD) says the appointment breaks rules meant to prevent ministers from taking charge of public regulatory agencies and impose limits on the kind of jobs that people who are past the retirement age may hold. If Savona is confirmed, he will be 89 when his seven-year term ends.

It also says Savona is unsuited for the post because until May of last year he was the director of a hedge fund which as Consob chief he would now have to oversee. The government sources said Prime Minister Giuseppe Conte would take over the reins as EU minister on a temporary basis.

Savona came under market and media scrutiny last June, when Mattarella's veto of his appointment as economy minister almost prevented the formation of the coalition government of the anti-establishment 5-Star Movement and the right-wing League. League leader Matteo Salvini said on Tuesday that Savona would be a "guarantee" as Consob.chief, adding that "lawyers will take care of the legal hurdles."

The top Consob job has been vacant since last September when the then-president, Mario Nava, resigned under pressure from the League and 5-Star because of his continued ties to the European Commission, where he had previously worked. However, the two coalition parties have struggled to find a compromise candidate. Mattarella last week shot down a proposal that economist Marcello Minenna, who is close to 5-Star, should take the post.

Minenna already works at Consob and Mattarella believes the top job should go to an external candidate, a source close to the president said. Minenna is likely to become Consob secretary general, according to Italian media. Savona has left little mark as EU Affairs Minister, and a political source said he was frustrated in the role, which has only a limited budget and not much real power.

In September, he sent the European Commission an 18-page document containing his ideas for EU reform, but it appeared to be receive little attention. The paper included a proposal that the public debt of all euro zone states to be brought below 60 percent of gross domestic product, via a long-term restructuring underwritten by the European Central Bank.

Savona has high-level experience as a minister, at the Bank of Italy, at private banks and with employers' lobby Confindustria. He was industry minister as long ago as 1993 and has written numerous books on international banking, monetary systems and macroeconomics. (additional reporting by Francesca Piscioneri and Massimiliano Di Giorgio; writing by Crispian Balmer; editing by Larry King and Steve Scherer)