Italian center-left leader Enrico Letta forged a new Italian government Saturday in a coalition with former Premier Silvio Berlusconi's conservatives, an unusual alliance of bitter rivals that broke a two-month political stalemate from inconclusive elections in the recession-mired country.

The daunting achievement was pulled off by Letta, who will be sworn in as premier along with the new Cabinet on Sunday at the presidential Quirinal Palace.

Italian designate-Premier Enrico Letta, right, shakes hands with Italian President Giorgio Napolitano. Letta agreed to appoint ex-Prime Minister Silvio Berlusconi's top political aide, Angelino Alfano, as deputy premier and interior minister. (Domenico Stinellis/Associated Press)

Letta, 46, is a moderate with a reputation as a political bridge-builder. He is also the nephew Berlusconi's longtime adviser, Gianni Letta, a relationship seen as smoothing over often nasty interaction between the two main coalition partners.

Serving as deputy premier and interior minister will be Berlusconi's top political aide, Angelino Alfano. He is a former justice minister who was the architect of legislation that critics say was tailor-made to help media mogul Berlusconi in his many judicial woes.

The creation of the coalition capped the latest political comeback for Berlusconi, who was forced to resign in 2011 as Italy slid deeper into the eurozone's sovereign debt crisis.

On Monday, Letta will be expected to lay out his strategy in Parliament in seeking required confidence votes from the Chamber of Deputies and the Senate.

"We negotiated for the formation of the government without throwing up any stop signs," Berlusconi told one of his TV networks. "That's how we contributed to forming a government in short time" after Letta was tapped Wednesday.

Berlusconi, a fervent anti-Communist, views Italy's left as a personal nemesis, and Letta's Democratic Party has some of its roots in what was the West's largest Communist Party.

Letta expressed "sober satisfaction over the team we put together and its willingness" to form a coalition.

'Necessary compromise'

Only a few weeks earlier, the head of the Democrats, Pier Luigi Bersani, resigned from the party post in humiliation and he refused Berlusconi's offer for a "grand coalition" and futilely tried to form a government without the center-right. Letta was a Bersani loyalist.

Bersani hailed the coalition formula as a "necessary compromise" that gives the country "freshness and solidarity."

The No. 3 bloc in Parliament, the anti-establishment 5 Star Movement, is led by comic Beppe Grillo, who ruled out any alliance with the largely sullied political class that has ruled Italy for decades.

President Giorgio Napolitano, who tasked Letta with creating a government out of bitter rivals, called upon the coalition partners to work "in a spirit of absolute, indispensable cohesion" as they work for sorely needed political and economic reforms.

"I hope there is maximum cohesion," Napolitano said.

The 87-year-old head of state sounded almost breathless as he expressed confidence the rivals could work together "without conflict or prejudices to find the right solutions" to the country's pressing economic and political problems.

Napolitano didn't name the challenges, but they include fighting unemployment, especially for young people, and corruption sullying much of the political class.

Napolitano said: "It was and is the only possible government," and one "whose formation couldn't be delayed further, in the interest of our country and of Europe."

He reluctantly agreed to be re-elected by Parliament earlier this month for another seven-year term because of the political instability.

Lives in working-class neighbourhood

Italy's economy is No. 3 among eurozone members, and financial markets have been anxiously watching to see if an effective government could be formed to carry on with outgoing Premier Mario Monti's efforts to keep the country from sliding into the eurozone's sovereign debt crisis.

Voters, fed up with new and higher taxes, including a despised property tax revived by Monti, rejected his severe austerity policies.

Who is Letta Letta spent his childhood in Strasbourg, home to the European Parliament, and studied international law before jumping into politics. In 1998, when he was 32, Letta became the youngest minister in Italy's history when he served as minister for European policy for then-Premier Massimo D'Alema, an ex-Communist leader.

The small centrist party created in time for the election by Monti, an economist and former European Union commissioner, will participate in the coalition, although Monti won't be in the Cabinet, which is heavy on two novelties — a large presence of female ministers and Italy's first black minister.

A native of Congo, Cecile Kyenge is a doctor who will serve as minister of integration. Proposals to make it easier for Italy' growing immigrant population to become citizens have gone nowhere in Parliament amid fierce opposition from the anti-immigrant Northern League party. The party, a Berlusconi ally, isn't in the new government.

Prominent among the women in the Cabinet is Emma Bonino, a former EU commissioner and Radical Party leader who will serve as foreign minister. Olympic gold medal kayaker Josefa Idem was tapped as minister of equal opportunity and sports.

Letta comes from a moderate wing of the left-rooted Democratic Party that is close to the Vatican. Since Parliament always includes an array of lawmakers enjoying good ties to the politically influential Catholic church in Italy, this was one more qualification on Letta's bridge-building resume.

The father of three, he lives in Rome's working-class Testaccio neighbourhood. When he was tapped by Napolitano on Wednesday, he drove his own car to the Quirinal Palace, in what was seen as a photo opportunity gesture to Italian taxpayers who widely despise the huge fleet of luxury cars that shuttles around ministers and lawmakers.