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Blow for Renzi as minister quits abruptly

Federica Guidi

Federica Guidi has quit as Italy’s economic development minister

Matteo Renzi’s government was shaken on Thursday by the abrupt resignation of Federica Guidi, the economic development minister, amid allegations that she had sought to shape last year’s budget law to favour an oil project from which her partner stood to benefit financially.

Ms Guidi’s departure represents a significant blow for Mr Renzi, the centre-left prime minister, who has cast himself as a young reformer far removed from the sclerotic and often corrupt ways that Italian politics has been run in the past.

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Ms Guidi announced her resignation in a letter to Mr Renzi while the prime minister was in the middle of a four-day visit to the US. Ms Guidi is well-known in Italian industry and internationally, since she was responsible for trade and investment policy and often led commercial delegations around the world, recently including visits to Iran and Egypt.

In her letter to Mr Renzi, Ms Guidi said she was “absolutely certain” of her “good faith” and the “appropriateness” of her work”. But she was resigning “as a matter of political opportunity”. Mr Renzi said he “respected” and “shared” her decision, praising her work over the past two years as “serious, decisive and competent”.

Ms Guidi’s departure came after the contents emerged of a wiretapped conversation in late 2014 during which she reassured Gianluca Gemelli, her partner, that the annual budget law would include an amendment to help speed up production at the Tempa Rossa oilfield, in southern Italy. The project is run by Total, the French oil company, and Mr Gemelli was due to benefit from it financially as a contractor.

Italy’s opposition parties immediately cried foul, demanding Ms Guidi’s resignation but adding that Maria Elena Boschi, the reforms minister and a close ally of Mr Renzi, should join her in quitting. In the wiretapped conversations, Ms Guidi said that Ms Boschi “agreed” that the amendment to the budget law should pass. Ms Boschi has been under fire since last year’s rescue of Banca Etruria, the Tuscan bank, at which her father was a high-ranking official before it collapsed.

“They all collude, they are all accomplices, their hands are dirty with oil and money,” tweeted Beppe Grillo, the former comedian who leads the populist Five Star Movement, Italy’s second-strongest party.

They all collude, they are all accomplices, their hands are dirty with oil and money

– Beppe Grillo

Ms Guidi’s resignation is the second high-profile scandal to rock Mr Renzi’s government. Maurizio Lupi, transport and infrastructure minister, was forced to quit last year after prosecutors and police unveiled a ring of corruption involving some of the nation’s most lucrative public works projects.

But Ms Guidi’s departure could be more damaging because it comes ahead of municipal elections in June and a constitutional reform referendum in the autumn which will be tests for Mr Renzi.

The prime minister’s ruling Democratic party remains solidly ahead of its rivals in opinion polls. But it has felt an increasing challenge from the Five Star Movement, which has put the fight against corruption at the top of its agenda.

Ms Guidi’s alleged move to favour an oil production project could also damage the government ahead of an April 17 referendum to ban offshore drilling near Italian coastlines. While opposition parties, including the Five Star Movement, have urged Italians to vote in favour of the ban, Mr Renzi has called for abstention. This could lead the referendum to fail since it needs more than 50 per cent turnout to be valid. But the circumstances of Ms Guidi’s resignation could help galvanise support for the measure.

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