ROME — Italian Prime Minister Silvio Berlusconi resolved a bruising fight with his coalition partners Saturday and named a new government tasked with reviving the economy ahead of next year's general election.

The Cabinet was sworn in at the presidential Quirinale Palace, becoming the nation's 60th government in as many years.

Center-left opposition politicians said the Cabinet, put together in just three days, was a carbon copy of the old administration and would be incapable of confronting the economic and social problems facing Italy.

But coalition allies said the new government represented a break with the past and promised that it would focus its efforts on boosting industry, increasing employment in the poorer south and protecting the purchasing power of Italian families.

Saturday's overhaul saw the appointment of new health, communications, industry and culture ministers. However, National Alliance party chief Gianfranco Fini remains foreign minister and deputy premier.

Berlusconi also announced the formation of a new ministry — Development and Territorial Cohesion — under Gianfranco Micciche, former vice minister of economy. Micciche, who is from Sicily, will oversee efforts to develop the economy in southern Italy — a concession by Berlusconi to Fini's faction, the largest in his coalition.

Berlusconi was forced to step down last week by two allied parties demanding radical changes in strategy after the center-right suffered a crushing defeat in regional elections this month.

The prime minister's political woes have grown out of Italy's economic troubles. Recent data suggest that the economy fell into a recession in the first quarter of 2005, the trade deficit is climbing and business confidence is at a 20-month low.

© 2005 Reuters

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