March 31, 2016 / 6:31 PM / a year ago

Italian industry minister quits over conflict of interest allegations

Italy's Minister of Economic Development Federica Guidi arrives for a confidence vote at the Senate in Rome February 24, 2014. REUTERS/Remo Casilli

ROME (Reuters) - Italian Industry Minister Federica Guidi resigned on Thursday over allegations of a conflict of interest after her partner was placed under investigation for influence peddling, in an embarrassment for Prime Minister Matteo Renzi.

Phone-tapped conversations released by the police appeared to show Guidi assuring her partner that the government would pass legislation that helped his business activities.

“I am absolutely sure of my good faith and that I have done nothing wrong, but I believe it is necessary for political reasons to hand in my resignation,” Guidi wrote in a letter to Renzi, published by her press office.

Renzi, who is currently in the United States, said he respected the minister’s decision and would name her replacement in the coming days.

Guidi’s rapid resignation could reduce the political fallout from the affair but opposition parties are still demanding that the whole government step down.

In a telephone tap contained in an arrest warrant seen by Reuters, the minister informed her partner Gianluca Gemelli about the reintroduction of an amendment into the 2015 budget law that was useful for his business.

The amendment helped France’s Total in its plans to develop Italy’s Tempa Rossa oil field by bypassing the need to secure permits from two Italian regions opposing the development. Gemelli, who had business ties to the development of the field, later called a manager at Total to give him “the good news” that the amendment had been re-introduced.

“It’s all moving again,” Gemelli said according to the phone taps, which were recorded in November 2014.

Matteo Salvini, leader of the right-wing opposition party the Northern League, said Renzi himself should resign.

“This is the umpteenth, monstrous conflict of interest of this government,” he said.

The anti-establishment 5-Star Movement, Italy’s second largest party after Renzi’s center-left Democratic Party, also called for the government to step down.

Guidi, an industrialist who is considered close to the center-right but has no party affiliation, is the second minister to quit Renzi’s two year-old government amid scandal.

Former Infrastructure Minister Maurizio Lupi resigned in March last year over allegations of a conflict of interest in the allocation of public contracts.

additional reporting by Francesca Piscioneri, Isla Binnie and Stephen Jewkes, editing by Angus MacSwan

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