Wednesday, November 9, 2011

Key ally urges Berlusconi to quit

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8 November 2011 Last updated at 13:03 GMT Silvio Berlusconi (file image from Jan 2011) Pressure on Mr Berlusconi to resign is now coming from his main coalition partner Italian Prime Minister Silvio Berlusconi's key coalition partner has urged him to step aside ahead of a crucial budget vote.

Northern League leader Umberto Bossi said he should be replaced by former Justice Minister Angelino Alfano.

Mr Berlusconi's majority has crumbled ahead of the vote, with several MPs defecting or saying they will rebel.

Until now he has insisted he has enough support to be able to continue to govern and has denied he will resign.

While Italy's deficit is relatively low, investors are concerned that the combination of Italy's low growth rate and 1.9tn euro (£1.63tn; $2.6tn) debt could make it the next to fall in the eurozone debt crisis.

"We asked the prime minister to stand aside," Mr Bossi told reporters on the margins of parliament.

However, when asked about the expected outcome of a normally routine vote on approving state finances, Mr Bossi told reporters: "Nothing will happen today."

After late-night talks with his own party and Northern League leaders, Mr Berlusconi is reported to have said that he would wait to see the outcome of the vote before making a decision on his future.

He spent the morning attempting to shore up his support with those MPs who had threatened to abandon him ahead of the vote, which has been delayed until 16:00 GMT.

Borrowing costs spike

Last month, the same budget measure was defeated in parliament by a single vote. Mr Berlusconi is reported to be short of the 316 votes needed to prove that he still has a majority.

But analysts say Mr Berlusconi may still win as the centre-left may abstain, allowing the essential measure to pass.

Members of the opposition have said they will be present in the chamber, but will not vote, La Repubblica reports.

"Our message to the coalition is, 'be counted'," Pier Luigi Bersani, secretary of the centre-left Democratic Party said, according to the paper.

Continue reading the main story Umberto Bossi Leader of the regionalist Northern League party which provides Silvio Berlusconi with a parliamentary majorityA former singer, aged 70, married (twice) with four sonsMinister for Institutional Reforms in the Berlusconi cabinetHad a break from frontline politics after suffering a stroke in March 2004 Were Mr Berlusconi to lose, he could either resign immediately or be ordered by President Giorgio Napolitano to call a confidence vote.

The BBC's Alan Johnston, in Rome, says it is certainly worth remembering that Mr Berlusconi is a master deal-maker and political infighter, having survived more than 50 confidence motions in the past.

But this crisis is different as it goes beyond Italian politics: it is instead linked to the international money markets, which have lost faith in Mr Berlusconi's ability to fix the Italian economy, our correspondent says.

The markets are now forcing Italy to pay interest rates that could eventually ruin it, which means the pressure on Mr Berlusconi is extraordinary, he adds.

Doubt about Italy's governance and its ability to repay its debts have sent the markets seesawing over the past two days.

On Tuesday, the cost of government borrowing spiked at a new record of 6.74% because of the crisis, just short of the 7% threshold at which Portugal and Ireland were forced to accept bailouts.



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