League allies may hinder Italy's Berlusconi: papers

By Iain Rogers

ROME (Reuters) - A strong showing by Silvio Berlusconi's xenophobic Northern League allies in Italy's election could spell trouble for him in his third term as prime minister, international commentators said on Tuesday.

The separatist party helped Berlusconi's conservative bloc to victory on Monday, but the New York Times noted that the separatist party led by firebrand Umberto Bossi provoked the collapse of the media magnate's first government in 1994.

London's Financial Times pointed to the League's protectionist stance and suggested its influence, after securing about 8 percent of the vote, would make it harder for Berlusconi to press ahead with economic reforms.

"Whether Italy will witness a new era of political stability remains in doubt," the Financial Times wrote.

"Protectionist-sounding statements from (Berlusconi's) allies ... suggest that his neo-liberal market policies might take a backseat in favor of more direct government intervention," it added.

That view was echoed by Argentine daily Clarin, which predicted the Northern League would exert strong influence over the economic policies of the next government.

The League's opposition to the proposed rescue of Alitalia by Air France-KLM cast a shadow over the loss-making state airline's future, the paper said.

London's Independent newspaper said the Northern League would be the "single most important influence on the new government". Germany's Die Welt said the party would "remain the uncertain factor which it has always been".

"The perma-tanned Silvio may be stealing the headlines but Italy's election has been a triumph for former bricklayer and guitar teacher Umberto Bossi and his tempestuous Northern League," the Independent said.

In Paris, Le Monde reminded readers that Bossi, who had a stroke in 2004 from which he is still recovering, had threatened during the election campaign to "take up arms" in a dispute over the design of ballot papers.

Spain's El Mundo said the Northern League was Berlusconi's Achilles' heel and underlined its federalist stance on tax issues, its demands on immigration and its strong skepticism about European Union integration.

"These arguments will be issues on the table that the prime minister will have to compromise on to count on their continued support," it said.

The Financial Times Deutschland, under a headline "Fiasco, third act", said there was no hope Berlusconi's third term as prime minister would be any different to the previous two.

"The only ones to benefit will be Berlusconi and his clique. He lacks the political will to modernize the nation. That's not just bad for Italy, but for the whole of Europe," it wrote.

(Additional reporting by Madeline Chambers in Berlin; Editing by Timothy Heritage)