ECB chief urges Italy to adopt emergency budget

Italy must immediately adopt the measures in its emergency budget to secure public finances and keep promises over public debt reduction, European Central Bank chief Jean-Claude Trichet said Friday. "The measures announced by the cabinet are crucial to cut public debt and increase economic flexibility, " he said in an interview with local financial daily Sole 24 Ore. It is essential that "all goals to better public finances are confirmed and concretized," Trichet said, adding that Italy's global financial credibility and solvability were at stake. Trichet urged the Italian government to also implement all necessary reforms to boost growth by further investing and exploiting its economic potential. On Aug. 12, Italy approved an extra 64-billion-U.S. dollar austerity program in a bid to avoid a believed debt crisis, but parliament still needs to definitely clear the document which is yet to be ultimately defined. The aim of the tight budget is to meet budgetary requirements by the European Central Bank (ECB) and reassure markets. Among the tight measures envisaged are cuts to government costs and reduction in the number of local authorities and national festivities, together with a pension reform and solidarity taxes affecting people with high incomes.