ROME -- Silvio Berlusconi's main coalition ally urged the Italian premier to step aside Tuesday as political uncertainty in the eurozone's third-largest economy rocked financial markets for yet another day.
Berlusconi did not immediately respond, but he has repeatedly resisted all calls for his resignation before his term ends in 2013.
Berlusconi's government is under intense pressure to enact quick reforms to shore up Italy's defenses against Europe's raging debt crisis. However, a weak coalition and doubts over Berlusconi's leadership abilities have markets fearing a looming financial disaster in Italy, which could bring down the 17-nation eurozone and shock the global economy.
"We asked him to step aside, take a step to the side," Northern League leader Umberto Bossi told reporters as he arrived ahead of a key vote in Parliament that could force Berlusconi's resignation. Bossi is the volatile ally who brought down Berlusconi's first conservative government in 1994.
Bossi said the man Berlusconi has already hand-picked to be his eventual successor, former Justice Minister Angelino Alfano, should now lead the government.
But it would be up to the Italian president, Giorgio Napolitano, to decide whether to appoint a new leader or dissolve parliament and call early elections.
With debts of around EU1.9 trillion ($2.6 trillion), Italy is considered by many as being too big for Europe to bail out, like it has already done for Greece, Portugal and Ireland. Italy represents a full 17 percent of the eurozone's GDP, compared to only 2.5 percent for Greece. Even worse, a substantial part of Italy's debt needs to be rolled over in the next few years, just as interest rates for it to borrow have been soaring.
On the face of it, Tuesday's vote would have been just a routine vote to approve 2010 state finances. But it has taken on much more significance now as a test of Berlusconi's political strength. It is not a confidence vote, which would automatically force the premier to resign.
Italy's center-left opposition said it would abstain in Tuesday's voting, to make it clear just how fragile Berlusconi's forces in Parliament are. If he is backed by fewer than 316 deputies -- or less than half of the 630-member chamber -- it would be plain that the prime minister can no longer count on a majority in the lower house of Parliament, even though the government could mathematically still win the vote.
One of Berlusconi's closest allies, lawmaker Francesco Cicchitto, told reporters that coalition leaders will take stock of the situation immediately after the vote.
"One thing at a time. First the vote, let's let it happen. Then we'll reflect on he vote," Cicchitto said.
International financial officials and the markets, meanwhile, fretted over how long it was going to take for Italian lawmakers to approve measures promised weeks ago by Berlusconi to rein in Italy's galloping public debt.
French Foreign Minister Alain Juppe, on French radio RTL, lamented what he called a "crisis of confidence" in Italy.
"I'm not making any judgment on Mr. Berlusconi personally. But I think there is a problem of confidence," Juppe said.
Italy's borrowing rates spiked Tuesday to their highest level since the euro was established in 1999. Higher rates make it more difficult for Italy to rollover its debts, and mean interest payments consume more and more of the country's national income. Italy has over EU300 billion ($412 billion) to raise in 2012 alone.
By late-morning, the yield on Italy's ten-year bonds was up 0.07 percentage point at 6.60 percent, down from an earlier high of 6.74 percent. A rate of over 7 percent is considered unsustainable and proved to be the trigger point that forced Greece, Ireland and Portugal into accepting financial bailouts.
The opposition center-left has long demanded the resignation of Berlusconi, citing sex scandals, criminal prosecutions and legislative priorities it says are aimed at protecting his own business interests rather than those of the country. However, it has failed to come up with a leader who can unite the rudderless opposition.
Berlusconi appeared to be frantically trying to line up vote after vote, with at least two party dissenters visiting his Rome residence Tuesday.
One, lawmaker Isabella Bertolini, told reporters upon leaving she would vote in favor of the government. She said Berlusconi had laid out for her "all the possibilities and options that he's evaluating: Stay, step back, step aside."
But while Berlusconi needs all the votes he can muster, at least one deputy from his People of Freedom Party won't make the vote. Lawmaker Alfonso Papa, who is being investigated in a corruption scandal, is under house arrest.
Finance Minister Giulio Tremonti hurriedly left a meeting of eurozone finance ministers in Brussels to return to Rome for the vote.
If he gets through Tuesday's hurdle, Berlusconi has indicated he would put a vote next week on the austerity measures to a confidence vote. If it loses that, Berlusconi would have to resign.
Antonio Di Pietro, a leader of a small center-left opposition party, told Sky TG24 TV that Berlusconi's "political adventure has been over for a while now." However, he doubted that Berlusconi would resign, even if he did fare poorly Tuesday.