Inching to a finale that is nowhere in sight

If Italy wants to retain many of the features that make it so attractive a place to live, it will need serious reform. But can it follow through?

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"For things to stay the same, everything must change."

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The famous quote from Giuseppe di Lampedusa's novel The Leopard has not been as apt for Italy since the days of the Risorgimento, the 19th-century movement for Italian unification.

Italy's finances may be in a different position to Greece's - the Italian problem is not so much one of deficit but debt combined with political paralysis - but if it wants to retain many of the features that make it so attractive a place to live, it will need serious reform. Does it have the will to do so?

Silvio Berlusconi, the prime minister, hardly looks like the man best placed to carry out a series of austerity measures.

He is embroiled in a series of seemingly never-ending scandals, and has spoken out disparagingly not only about his own finance minister, but also other European leaders including Angela Merkel, Germany's chancellor.

Giulio Tremonti, the Italian minister of economy and finance, is well respected in financial circles, while Mrs Merkel's mighty coffers probably hold the key to keeping the euro together.

Italy has managed to pass an austerity budget in the past few weeks that promises to balance the budget by the end of 2013.

But this has impressed neither the markets, which have pushed up the cost of Italian borrowing to more than 5 per cent, nor Italian workers.

Their protests have not been as violent or as prolonged as the Greeks - yet - but it is early days.

Nor is it clear that these austerity measures will bring the benefit without causing too much pain.

The IMF acknowledged in the aftermath of the Asian debt crisis in 1997 that many of the measures it imposed were too draconian. Has this lesson been absorbed, or simply ignored in the panic?

One trade federation leader called the budget "demented". This crisis is inching to a conclusion, although don't expect one any time soon.

At the moment it looks like everything will stay the same, instead of changing.