Italy's new premier-designate economist Mario Monti says he will get to work quickly to try to form a new government, assuring the nation that it can heal its disastrous finances.

Monti told reporters in Rome on Sunday night he will carry out the task "with a great sense of responsibility and service towards this nation."

The former European Union competition commissioner received the formal mandate from President Giorgio Napolitano.

Monti must now draw up a Cabinet, lay out his priorities and see if he has enough support in Parliament to govern effectively.

Hours earlier, Silvio Berlusconi's party gave its crucial approval for Monti to assemble a government, but insisted that it last only long enough to implement urgently need economic reforms.

Berlusconi resigned reluctantly as premier late Saturday, bowing out after world markets pummelled his country's borrowing ability, reflecting their loss of faith in his economic programme.

Berlusconi quit shortly after the Italian parliament approved new reform measures demanded by the European Union and central bank officials.

But whether Berlusconi's forces will give Monti crucial support in Parliament depends on who Monti chooses for his Cabinet and what his government's priorities will be.

Monti faces a monumental task: preventing an Italian default that could tear apart the coalition of 17 countries that use the euro and send Europe and the U.S. into new recessions.

Italy's economy is hampered by high wage costs, low productivity, fat government payrolls, excessive taxes, choking bureaucracy, and an educational system that produces one of the lowest levels of college graduates among rich countries.

In addition, as the third-largest economy in the eurozone, Italy is considered too big for Europe to bail out like it did Greece, Portugal and Ireland.

The next Italian government needs to push through even more painful reforms and austerity measures to deal with 1.9 (t) trillion euros (2.6 (t) trillion US dollars) in debt - about 120 percent of the country's economic output.

And many of those debts are coming due soon - Italy has to roll over more than 300 (b) billion euros (410 (b) billion US dollars) of its debts next year alone.