It’s now been several days since Silvio Berlusconi resigned as Italy’s prime minister and the euphoria has settled down. Interest rates on Italian bonds are rising again and calls for the European Central Bank to intervene with its “unlimited powers” (which means inflating Europe out of its debt crisis) grow ever louder.

Let’s hope that won’t happen and the “technocratic” government in Rome enacts comprehensive reforms and fast. The Italian economy needs to become much more competitive if it is to grow out of debt, especially the southern economy.

I write about the north-side divide that’s characterized Italy since its inception in A Tale of Two Italies at the Atlantic Sentinel. Here’s what struck me the most:

Southern Italian provinces, including Sardinia and Sicily, are classified under the European Union’s convergence objectives because gross domestic product per capita there is 69 percent of the European average and industrial development lacking. In the central and northern provinces, by contrast, incomes are much higher, ranging from 116 to 126 percent of the EU average.

The northern economy is quite strong and vibrant but corruption, organized crime and rigid labor laws constitute major impediments to growth in the south. This needs to be addressed lest Italy, and with it, Europe, be dragged down into the maelstrom of Europe’s sovereign debt crisis.