Implementation of Italy's reforms crucial: Van Rompuy

Italy's Prime Minister Silvio Berlusconi (L) and European Council President Herman Van Rompuy (R) address a joint news conference at the end of a meeting in Brussels September 13, 2011.

BRUSSELS (Reuters) - The implementation of Italy's reform and austerity package to balance the country's budget by 2013 is important not only for Italy, but for the euro zone as a whole, European Council President Herman Van Rompuy said.

Van Rompuy, who chairs quarterly meetings of European Union leaders, spoke to reporters after a meeting with Italian Prime Minister Silvio Berlusconi.

"Our meeting was focused on... the euro zone economic situation and on the measures taken by Italy and on the reforms of economic governance," Van Rompuy said.

"The adoption of the (Italian reform) package, envisaging budget equilibrium by 2013, is important not only for Italy but for the euro zone as a whole," he said.

"Its full implementation is crucial. Fiscal discipline and growth-enhancing reforms are essential for the confidence of markets," he added.

Berlusconi reconfirmed his ambition to achieve a balanced budget in 2013 and said the austerity package would be approved by the Italian parliament on Wednesday.

"I have confirmed our firm determination ... to live up to the task of reaching this balance by 2013," Berlusconi said.

"As well as the austerity package, we are determined to pursue measures to boost growth."

Italy's 54 billion euro ($74 billion) austerity package, which includes a 1 percent rise in value added tax, as well as cuts to government spending, is in the final stages of the parliamentary approval process.

But yields on Italian five year bonds hit their highest level since the introduction of the euro a decade ago after an auction on Tuesday, which underlined mounting fears over the currency bloc's third largest economy.

Italy has been dependent on support from the European Central Bank to keep a lid on its borrowing costs for more than a month, but a surge in bond yields over the past week suggests that financial market sentiment has turned against the country.

"We are determined to accompany the budget consolidation measures with measures linked to growth and development, to intervene against what in certain cases is a true bureaucratic oppression which exists in our country," Berlusconi said.

(Reporting by Jan Strupczewski, editing by Luke Baker and Rex Merrifield)