The last time Giuseppe Conte presented his Cabinet, the president turned it down | Vincenzo Pinto/AFP via Getty Images 5Stars and League strike new Italian coalition deal Populist parties drop Paolo Savona as proposed economy minister.

ROME — Italy could have a new government as soon as Friday after the 5Star Movement and League reached agreement on a Cabinet team.

"The 5Star Movement and the League have reached an agreement on a political government headed by Giuseppe Conte as prime minister," the two party leaders, Luigi Di Maio and Matteo Salvini, said in a joint statement.

Conte, a law professor, would need to be given a new mandate by President Sergio Mattarella, and was summoned to the presidential palace at 9 p.m. Thursday. The president will have to sign off on the entire team.

The last time Conte presented his Cabinet, the president turned it down because Paolo Savona, a Euroskeptic economist, was slated for the finance ministry. This time, Savona will be given another post, possibly European affairs minister.

Under the new agreement, the economy minister would be Giovanni Tria, an economics professor. Tria is not well-known, but in recent opinion pieces he denounced Germany’s surplus as an indicator of the failure of the euro. However, he is not regarded as a supporter of Italy leaving the eurozone.

Carlo Cottarelli, who had been asked by Mattarella to form a technocratic government after the previous Conte coalition failed to get approval, officially returned his mandate on Thursday afternoon, paving the way for the populists to take control.

If Mattarella says yes to the populists, the new Cabinet would then face a vote of confidence in both houses of parliament, where the two parties have a thin majority. The far-right Brothers of Italy, a League ally, said it will abstain in that vote, which would help the coalition get approval.

The prospect of a populist and Euroskeptic government in Italy, the third largest economy in the eurozone, has already rattled markets and worried its EU partners.

Concerns have risen about the two parties’ “contract for a government of change,” which includes radical and costly measures and a tough line toward Europe.

The new government would be expected to take a strong Euroskeptic line and seek confrontation with Brussels on eurozone governance, the EU budget, Russia sanctions and migration.

League leader Salvini is slated to become interior minister and has already promised to toughen Rome’s immigration stance and speed-up deportations of illegal migrants.