NEWSMAKER-Monti steps boldly into Italy election race - maybe

* Monti leaves options open over standing in election

* Says may stand at head of centrist alliance

* Opens himself to attacks in more political role

ROME, Dec 23 (Reuters) - Outgoing Italian Prime Minister

Mario Monti has many unquestioned qualities but it is starting

to seem that bold political decision-making may not be one of

them.

After keeping his supporters waiting for weeks to know

whether he would lead them in Italy's upcoming election, Monti

held an eagerly awaited news conference on Sunday - and

announced that they would have to wait a little longer.

For most of his 13 months in office Monti repeated that he

would withdraw from politics when his term ended.

In September he changed tack and said he would be willing to

serve a second term but only if the election produced no clear

winner, and then in the last few weeks he let it be known that

he was considering actually running in the election.

Monti's indecision over whether to stand or not dominated

Italian media coverage in just the same way that similar changes

of position by his predecessor Silvio Berlusconi had done a

couple of months earlier.

The issue dominated the two-hour news conference but by the

end of it, journalists were still scratching their heads over

what the former European commissioner had actually decided.

"I have to say that I still don't understand anything,"

Lucia Annunziata, one of Italy's most experienced journalists

told Monti in a television interview later in the day.

Roberto Maroni, the leader of the pro-devolution Northern

League party, tweeted his derision.

"I'm not running, but maybe I am ... Monti has learned from

the most false Christian Democrats of the first Republic," he

said, referring to the party that ruled Italy for 60 years after

World War Two and was famed for its opaque political intrigues.

The picture is now somewhat clearer and can be summed up as

follows: Monti will present a list of policy priorities and wait

to see if a credible centrist alliance emerges that adopts the

plan as its own and has a chance of doing well in the election.

If this happens, he will agree to stand at the election as

the alliances's candidate for prime minister.

While this strategy may seem a cautious one, the risk for

Monti is that by promoting a centrist alliance he has sacrificed

his aura as a non-partisan technocrat. After being put on a

pedestal for most of his premiership, he will now be fiercely

attacked in the election campaign by left and right alike.

It may also all be for nothing, as polls show the centrist

parties that back Monti currently command no more than about 10

percent of the vote.

Monti said he hoped new forces from "civil society" emerge

to join forces with them and create a major bloc, yet he

admitted this was a gamble with "many risks and a high

probability of failure".

"NIGHTMARE"

If the snowball effect does not materialise, it can be

assumed that Monti will simply decline to offer his name to any

party, and will be no more than an onlooker at the election.

A taste of what he is in for in his new role as politician

rather than technocrat was already clear on Sunday from

potential foes at the election. Berlusconi said a new Monti

government would be a "nightmare".

Another risk for Monti is that what follows may partly

overshadow the notable achievements of what has gone before.

The 69-year-old former economics professor replaced the

scandal-plagued Berlusconi last year as sky rocketing borrowing

costs threatened to plunge Italy into a Greek-style debt crisis.

When Berlusconi pulled his backing for Monti's technocrat

government on Dec. 6, the gap between Italy's benchmark bonds

and safer German Bunds stood below 3.2 percentage points,

little more than half the level when Monti took over.

With his economist's training and measured, sober manner

Monti was the perfect antidote to the discredited Berlusconi.

His rapport with German Chancellor Angela Merkel has been

particularly crucial as for the first time in years Italy's view

began to be taken seriously in European decision-making.

In a heady first few months that saw him named European of

the year in the French parliament and feted by the international

media he acted decisively to convince investors that Italy could

bring its finances under control.

Capitalising on record approval ratings he rushed through 20

billion euros ($25.86 billion) of deficit cuts including a

widely praised pension reform to raise the retirement age.

He lost some of that shine, at least domestically, as the

months went on and the recession deepened, aggravated by a raft

of tax hikes. Subsequent reforms to deregulate services and the

labour markets got bogged down and diluted by parliamentary and

union opposition.

Economists are divided over the quality of Monti's attempts

to free up Italy's economy but he has remained the darling of

financial markets and he undoubtedly began to address

deep-rooted problems that festered unattended for years.

He said this week that the structural reforms needed to make

Italy competitive had only just begun. Investors will be pleased

to see that there is still a chance that after February's

election Monti till still be in charge to tackle them.

Most Popular in Business