/ 14 July 2004

Italian government crisis averted

Italian Prime Minister Silvio Berlusconi said on Wednesday his coalition has averted a full-blown government crisis and vowed to remain in power until the next general election.

Speaking in the Senate after holding days of emergency talks with his centre-right allies, Berlusconi said his House of Freedoms coalition will ”continue to govern until the end of the legislature”, in 2006.

The prime minister was asked to address lawmakers on the state of health of his Cabinet following the resignations last week of his economy minister, Giulio Tremonti.

Tremonti was forced to step down by the National Alliance and the centrist UDC party, which have both been demanding a greater say in economic policy.

Tremonti’s resignations were the most visible result of what has since turned out to be the biggest crisis within Berlusconi’s four-party coalition since its rise to power in 2001. Tremonti’s successor has not yet been named, with Berlusconi taking over the post in the meantime.

Addressing lawmakers on Wednesday, Berlusconi said the Economy Ministry will now lend a more sympathetic ear towards the demands of other coalition members. He also promised to go ahead with plans to cut taxes amounting to ”1% of gross domestic product”.

Members of the UDC, which had threatened to pull out of the government altogether, said on Wednesday that differences within the coalition no longer seem ”insurmountable”. — Sapa-DPA