Rome

Letta talks to parties to form government

Chance of success 'too close to call'

Letta talks to parties to form government

Rome, April 25 - Centre-left Democratic Party (PD) deputy head Enrico Letta talked to parties Thursday to break Italy's political logjam and form a government two months after inconclusive elections. Newly re-elected President Giorgio Napolitano tapped Letta Wednesday after lashing parties for not agreeing on a broad-backed reform government and saying he would quit if they didn't. Letta, 46, would be Italy's third-youngest premier if he pulls off the tricky job of getting old enemies PD and scandal-plagued conservative ex-premier Silvio Berlusconi's People of Freedom (PdL) party to bury their differences. Italian media said Thursday Letta's chance of success was "too close to call". The aim is to form a slimmed-down 18-minister government before the financial markets open Monday. Hurdles include the PdL's electoral pledge to pay back a property tax, which the PD thinks is not possible given EU budget constraints, and deep divisions over the justice system. Many in the left wing of the PD, which is riven by factional squabbling after outgoing leader Pier Luigi Bersani failed to get two candidates elected, are dead against an alliance with arch enemy Berlusconi, involved in trials for paying an underage prostitute for sex and tax fraud at his Mediaset media empire. Bersani resigned amid a PD meltdown and parties begged Napolitano, 87, to serve an unprecedented second term. In his re-inaugural speech he lashed "deaf" and "sterile" parties who have been discredited by corruption scandals for failing to pass reforms including a new electoral law that could produce a clear winner, and measures to create jobs and lift the economy out of its worst recession in 20 years. On February 25 the PD's alliance got a majority in the House but not the equally powerful Senate, leading to a hung parliament where the anti-establishment 5-Star Movement (M5S) led by comedian Beppe Grillo holds the balance of power. Berlusconi's alliance came in a very close second and the three-time premier has since been calling for a grand coalition with the PD. Bersani rejected this and tried to reach out to M5S, which is refusing to work with either party. On Thursday Napolitano appealed to the parties to show "courage and determination" to seal a deal on a left-right coalition which would also be backed by outgoing Premier Mario Monti's Civic Choice. PdL leader Angelino Alfano said Wednesday the PD must fully back a Letta government or be responsible for a weak administration tasked with taking Italy back to the polls in June, possibly with a new electoral law. Berlusconi said Thursday the new government must stoke growth in the eurozone's third-biggest economy. Letta has also said he will push for the EU to ease austerity policies - a call that was backed Thursday by the IMF.

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