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Political row after Telecom Italia resignation

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Political row after Telecom Italia resignation


A battle over the future of Telecom Italia has stoked political tensions in Italy. The company, the country’s biggest employer, announced this week that it would split its mobile and fixed-line operations – a decision openly criticised by the government. In a surprise move, the company chairman resigned on Friday. His replacement is Guido Rossi, who was company chairman nine years ago when the group was privatised.

The outgoing chairman and controlling shareholder – Marco Tronchetti Provera – says he resigned because of the government’s negative reaction to the split and a clash with Prime Minister Romano Prodi. Critics of Prodi say the resignation points to state interference and an indication he is seeking to re-nationalise the firm.

The prime minister – on a visit to Shanghai in China where he is leading a delegation of Italian business people – said he had not known of the company’s plans or of Tronchetti Provera’s resignation beforehand. The differences between the prime minister and the head of a leading private company have brought Prodi’s main rival – Silvio Berlusconi – out in smiles. Berlusconi said parliament would have to decide on whether there was state interference. He said Prodi “would have to accept what parliament concluded”. The political fall-out over what is now the Telecom Italia affair is set to continue.

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