August 20, 2019 11:16 pm

Italy’s PM resigned — now the country needs billions to help avoid recession

WATCH ABOVE: Italy's Conte makes an angry exit from his prime minister role

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Italian Prime Minister Giuseppe Conte resigned Tuesday, citing that his Interior Minister Matteo Salvini created a political crisis that would plunge Italy into political and economical instability.

His announcement to step down before the Senate was highlighted by sharp rebukes against Salvini, who was also the leader of far-right party the League.

According to Conte, Salvini’s move to call another election would place Italy under a weaker provisional government just ahead of its deadline on the 2020 budget.

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As of now, Italy has to gather financial resources worth 23 billion euros to avert the possibility of a tax-hike that could potentially spark a new recession.

Italy’s now-former government was made up of a coalition between the populist Five Star Movement party and Salvini’s. The coalition was created a mere 14 months ago.

Conte, a former law professor, was chosen to lead the coalition government as a neutral independent.

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The resignation came as a move to avert a no-confidence vote that was tabled by Salvini, who, in a surprise move in early August, declared that his alliance with the Five Star Movement was forfeit and called for elections.

According to University of Western Ontario Italian politics professor Pietro Pirani, Salvini had made the call to start a government crisis because he wanted to capitalize on his party’s current momentum.

The European Parliament election three months ago saw the League become the top political party among Italians. The current opinion polls also showed the anti-immigrant party at an expected 36 per cent of the vote.

“He was getting this sense that he was having momentum, and so he started thinking that it was a chance for him to run for a new election,” said Pirani.

“He decided to start the crisis for the government; he thought he could capitalize on the exit polls.”

What happens next?

What was seen as a huge political gamble may have been a plan that would eventually backfire due to Conte’s resignation.

Politicians from both the Five Star Movement and centre-left Democratic Party (PD) openly discussed forming a new coalition, one that would push the League into official opposition.

Earlier in the month, the League’s attempts at a previous attempt to win enough support for a confidence motion against Conte was prevented when the Five Star Movement and PD joined forces to block it.

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The move showed that an alliance between the Five Star Movement and PD was a possibility and coalition between them would shift Italy’s government towards a more centrist, pro-European stance.

“So Salvini decided to push for a crisis, but he didn’t realize that there was a possibility the Five Star Movement would turn their back on him and go for the Democratic party,” said Pirani.

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“That created this moment of confusion because suddenly, Salvini found himself in a very weak spot facing the possibility of the collapse of the government, the elimination of the prime minister and a new government without a new election, so the major turning point was that it was a miscalculation for Salvini.”

Italy’s President Sergio Mattarella will be meeting with various party leaders to look at possible coalitions, but it is expected he will only go ahead with a government that is sound enough to avert early elections due to the looming budget deadline.

The other parties? 

A larger, more powerful long-term coalition was suggested by political analysts to be a tie-up between the left, the Five Star Movement and the centre-right Forza Italia party.

Should coalition talks fail, a caretaker government could be formed by all of the main parties. Another politically-neutral figure such as Conte would head the government and would be in charge of delivering the new budget.

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In the event that even a caretaker government is unable to form, Mattarella would have no choice but to call new elections — the scenario Salvini aimed for.

An election, which would take place as early as late October, could make him prime minister with more than 50 per cent of the vote should there be an alliance with other right-wing parties.

— With files from Reuters and The Associated Press

Follow @laowkeysavage

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