ANALYSIS OF THE STRUCTURE OF THE FORMAL LETTER

The present text is a formal letter sent by the Governing Council of the European central Bank, Jean Claude Trichet and Mario Draghi to the Italian Prime Minister, Silvio Berlusconi.

After the salutation the letter starts with an introductory paragraph in which the sender uses background information to introduce the subject of discussion. Right from the first lines the intelligent reader can understand the reason for writing the letter:

•§   t The governing Council pressing action by Italian authorities is essential to restore the confidence of investors.

In the second paragraph Trichet and Draghi advance their thesis. They also explain the reasons why their request is so important. They also quote the conclusion of the Government Summit of 21^st July 2011 in order to qualify their statement.

As a consequence Italy needs to URGENTLY underpin the standing of its sovereign signature and its fiscal sustainability and structural reforms. They also highlight the steps taken by Italy are not enough towards a balanced budget in 2014.

This is the reason why in the 3^rd paragraph Draghi and Trichet make a list of urgent needs and provide their explanatory function:

•§  The first need is to increase competition, particularly in services to improve the quality of public services and to design regulatory and fiscal system better suited to support firms' competitiveness and efficiently of the labour market.

•a.       Reform strategy (liberalization of public services)

•b.      Further reform the collective wage bargaining system (allowing firm-level agreement to tailor wages and working conditions to firms' specific needs)

•c.       _ Review of rules regulating the hiring and dismissal of employees

_ Establishment of an employment insurance system

_ To ease reallocation of resources in view of more competitive firms and sectors

•§  The second need consists on taking immediate and bold measures to ensuring the sustainability of public finances.

•a.       Additional-corrective fiscal measures

•b.      Introduction of deficit reducing clause

•c.       Borrowing (commercial debt and regional and local governments expenditures) should be placed

UNDER TIGHT control

After that Draghi and Trichet underline the importance to take all locations listed in sections 1 and 2 as soon as possible. They must be taken by decree laws followed by Parliament ratification.

The third and last one need is to take immediately measures to overhaul of the public administration. It is essential to improve administrative efficiency and business friendliness.

To conclude they underline their trust in the Government that will take all the appropriate actions.