Italian president likely to ask Berlusconi to form new government

Silvio Berlusconi appeared set to receive a mandate to form a new government Friday, two days after he resigned as Italy's premier following a crushing defeat in a regional election.

Berlusconi's allies expressed their support for a second consecutive Cabinet headed by the conservative media mogul as Italy's president held a second day of talks with party leaders.

"We are working toward the creation of a new (Berlusconi) Cabinet very soon," Gianfranco Fini, the leader of the coalition's second-largest party, said after talks with the president.

"I have the feeling that (the solution to the government crisis) can be very swift," said Fini, who has served as foreign minister and deputy premier.

Fini's support was key for Berlusconi as his National Alliance party had threatened to withdraw its ministers at the height of the crisis earlier this week. Fini is also demanding sweeping policy changes.

Berlusconi stepped down Wednesday, but vowed to form a new Cabinet immediately. He said he could have a lineup of ministers ready by the end of Friday.

"I'm working, I'm serene and optimistic, and I think that with dedication and patience problems get solved," Berlusconi was quoted as saying by ANSA late Thursday.

However, one point that remains contentious is the ministry of reforms. The post has been held by the Northern League, which has pushed a massive constitutional reform to delegate more powers to Italy's regions. The bill is awaiting parliamentary approval.

Two other coalition partners, the right-wing National Alliance and a smaller centrist ally, have been skeptical of the reform, and have long complained about Berlusconi's closeness to the League.

President Carlo Azeglio Ciampi is assessing whether the premier has enough support to form a new government. His talks with political parties are set to end at midday.

The president has two options: to dissolve parliament and call early elections or to designate a premier to assemble a new government. He is widely expected to tap Berlusconi to form a new Cabinet to serve until the end of the legislature's term in mid-2006.

The crisis of the ruling conservative coalition stems from an embarrassing defeat suffered in April 3-4 regional elections. Berlusconi's allies demanded that he step down and form a reshuffled Cabinet _ a technique used by several Italian premiers in the past to strengthen faltering coalitions.

Berlusconi, who was elected in 2001 and led Italy's longest-serving postwar government, had resisted the move, sensing it would undermine his image as a new-style politician.

But he was eventually forced to give in after a government partner withdrew its ministers and the National Alliance also threatened to pull out.

ALESSANDRA RIZZO, Associated Press Writer