Italian Premier Silvio Berlusconi promised Tuesday to resign after parliament passes economic austerity reforms demanded by the European Union, capping a two-decade political career that has ended with Italy on the brink of being swept into Europe's debt crisis.
Italian President Giorgio Napolitano met for about an hour with Berlusconi after the premier lost his parliamentary majority during a routine vote earlier Tuesday. In a statement, Napolitano's office said Berlusconi had promised during the meeting to resign once the economic reforms have passed parliament.
A vote on the measures is planned for next week.
According to the Associated Press, Berlusconi said his decision to resign after parliament passes economic reforms is for the good of the country, and to settle financial markets that have lost confidence in Italy's ability to rein in debt and spur growth.
Berlusconi said late Tuesday that he would prefer to call early elections, but that the decision rests with Italian President Giorgio Napolitano.
In comments that marked a dramatic shift from his normally defiant tone, Berlusconi conceded he had lost his parliamentary majority during a routine vote Tuesday and that "things like who leads or who doesn't lead the government" is less important than doing "what is right for the country."
Berlusconi's key coalition ally Umberto Bossi, head of the devolutionist Northern League, said Berlusconi should be replaced by Angelino Alfano, secretary of the premier's PDL party, reports Reuters.
"We asked the prime minister to stand down," Bossi told reporters outside parliament.
Much like Greece's George Papandreou, Berlusconi will become the next high-profile "political victim of the euro-zone crisis that has been ravaging the continent for the past two years," writes the Wall Street Journal.
So far, the news has had a positive impact on the markets. Stocks are rallying on the news and the Dow instantly shot up by 50 points, reports Business Insider.
Some analysts see his exit as a blessing because Italy has been paying the price for Berlusconi's financial and personal indiscretions. There was very little trust that he would be capable of enacting the reforms necessary to help Italy.
But there is an important question that Business Insider asks and it deserves to be repeated:
. . . how much does [Berlusconi resigning] help in reality? While there might have been some Berlusconi premium on bonds, it's easy to imagine any benefit being very short-lived, as it dawns on everyone that the country faces some deep structural issues that can't easily be rectified.
This is a breaking story. Updates will be added. The Associated Press contributed to this report.