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Hopes rise over end to Italy paralysis

September 28, 2010

By Guy Dinmore in Rome, published: September 28 2010

Scandals and bitter infighting within Silvio Berlusconi’s centre-right government have yielded memorable moments of political theatre. But behind the headline-grabbing spectacle, Italy’s business leaders are growing impatient with months of paralysis and hoping a showdown in parliament on Wednesday will break the impasse.

Mr Berlusconi’s presentation of his government’s agenda, expected to be followed by a vote of confidence, should reveal whether his coalition has the numbers to struggle on. Alternatively the stage could be set for early elections which few seem to want, not least the business community.

Meanwhile, a list is growing of key decisions and appointments waiting to be made – for an industry minister to succeed Claudio Scajola, who quit over a property scandal in May, a new head of the stock market regulator Consob, and a new chairman for the antitrust authority.

Venting her frustration, Emma Marcegaglia, head of Confindustria, the main employers’ association, is urging politicians to stop their “show” and get on with business. The patience of enterprises, workers and families was being exhausted, she said last week.

Stalled plans to relaunch Italy’s nuclear industry illustrate the sense of stasis. The government is more than seven months late in creating a nuclear safety agency, a crucial step towards identifying sites for nuclear waste and four nuclear power plants to be built by a joint venture of Enel, the domestic utility, and France’s EDF, which announced their plans more than 18 months ago. According to Chicco Testa, managing director of Rothschild in Rome and head of a lobby representing major companies in the nuclear industry, Mr Berlusconi has put such appointments on hold until he resolves the shifting balance of power.

Existing and new allies need to be rewarded with plum posts. Gianfranco Fini, the prime minister’s former ally who now leads a breakaway faction, dubs it the Standa system, after a supermarket chain Mr Berlusconi used to own.

“Italy has the problem of choosing the right people for really independent agencies. Friends get appointed instead of experts in the public administration,” says Mr Testa.

Italy’s failure to complete major infrastructure projects is systemic and Mr Berlusconi has failed to deliver, he adds.

“No one in this country is in favour of change or modernisation. We are full of conservatives,” he explains. Mr Scajola, the driving force behind Italy’s nuclear renaissance who was replaced “temporarily” by Mr Berlusconi himself, is sorely missed by the industry. Many would like his job.

Massimo Calearo – elected to parliament for the opposition Democratic party in 2008 but considering switching his support to Mr Berlusconi – says in a newspaper interview there is a “queue” for the post and he would gladly consider it.

Once a leader in nuclear power, Italy decommissioned its four power stations after Italians voted for a moratorium following the 1986 Chernobyl disaster. Mr Testa was then a leading anti-nuclear campaigner. He now argues that Italy needs to go nuclear again to be price competitive, cut greenhouse gas emissions and, as the only country in the G8 leading industrial nations without it, to “build its muscle” on the international stage.

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