Italy's Berlusconi to resign after reforms pass

Premier Silvio Berlusconi promised Tuesday to resign after Parliament passes economic reforms demanded by the European Union, capping a two-decade political career that has ended with Italy on the brink of being swept into Europes debt crisis.Berlusconi met for about an hour Tuesday evening with Italian President Giorgio Napolitano after losing his parliamentary majority during a routine vote earlier in the day. In a statement, Napolitanos office said Berlusconi had understood the implications of the vote and promised to resign once parliament passes economic reforms designed to spur growth and rein in Italys public debt.A vote on the measures is planned for next week.Berlusconis government is under intense pressure to enact quick reforms to shore up Italys defenses against Europes raging debt crisis. However, a weak coalition and doubts over Berlusconis leadership ignited market fears of a looming Italian financial disaster that could bring down the 17-nation eurozone and shock the global economy.Italys borrowing rates spiked Tuesday to their highest level since the euro was established in 1999. The yield on Italys ten-year bonds was up 0.24 percentage point at 6.77 percent. A rate of over 7 percent is considered unsustainable and proved to be the trigger point that forced Greece, Portugal and Ireland into accepting financial bailouts.In a dramatic shift from his usually defiant tone, Berlusconi conceded late Tuesday he no longer had a parliamentary majority and would step aside for the good of the country. The markets dont believe that Italy is capable, or has the intention of approving these reforms, he told his private Mediaset television.Things like who leads or who doesnt lead the government is less important than doing what is best for the country, he said.The presidents office said that once Berlusconi resigns, Napolitano would begin political consultations to form a new government. The most widely discussed name to lead a technical government is Mario Monti, the former EU competition commissioner, though Berlusconis right-hand man, Gianni Letta, and the head of his political party, Angelino Alfano, have also been mentioned and rejected by the opposition.