Mr Draghi, Italy’s outgoing Prime Minister, submitted his resignation to President Sergio Mattarella on Thursday morning after key coalition parties withdrew their support for his government. Hours later, Mr Mattarella dissolved parliament.
Mr Mattarella and Mr Draghi signed the dissolution decree at the Quirinal Palace in Rome on Thursday afternoon. Before heading there, Mr Draghi was given a round of applause in the lower house of parliament.
Dubbed Super Mario for his handling of the eurozone crisis as head of the European Central Bank, he first tendered his resignation a week ago when a populist party — the Five Star Movement (M5S) — in his broad-based coalition government refused to back an economic proposal for businesses and families.
The €26bn (£22bn) package was designed to help Italians tackle inflation and energy costs. The M5S boycotted it arguing it was insufficient. The party was also unpleased that the package contained a provision to build a huge waste incinerator plant in the capital.
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President Mattarella had asked him to stay in the post until the planned end of the legislature in early 2023 and, after days of silence, Mr Draghi said he would continue if the political parties were prepared to back a strong, cohesive government.
But that was not the case, with things crumbling on Wednesday when three of his main partners — Silvio Berlusconi’s Forza Italia, Matteo Salvini’s far-right League and, again, the M5S — snubbed a confidence vote he had called to try to end divisions and renew their fragile alliance.
Mr Draghi, 74, was a popular choice as Prime Minister. He took office in 2021, as Italy wrestled with the coronavirus pandemic and an ailing economy.
The Milan stock market fell for the second day in a row on Thursday. Another key indicator closely watched in Italy, called the spread, soared nine percent. It represents the gap between Italian and German 10-year bonds.
He had urged unity in order to tackle issues such as the Ukraine war, the energy crisis, social inequality and the enactment of reforms needed to obtain the next tranche of the €200bn Rome is due to receive from the EU’s post-pandemic recovery fund.
Mr Draghi’s government will remain in office in a caretaker role until early elections in autumn, President Mattarella said after formally accepting the decision.