By Steve Scherer

ROME (Reuters) – A senior parliamentarian in the anti-immigration Northern League party has likened Italy’s first black minister to an orangutan.

1. Cecile Kyenge, an Italian citizen born in the Democratic Republic of Congo, has been the target of repeated racial slurs since her appointment as integration minister in April.

Roberto Calderoli, vice president of Italy’s Senate, said on Saturday at a political rally in the northern town of Treviglio, “I love animals – bears and wolves, as everyone knows – but when I see the pictures of Kyenge I cannot but think of, even if I’m not saying she is one, the features of an orangutan.”

He said the success of Kyenge encouraged “illegal immigrants” want to come to Italy, and she should be a minister “in her own country”, according to media reports.

Most of the racist taunts – “Congolese monkey”, “Zulu” and “the black anti-Italian” – have come from far-right groups.

Last month, a Northern League member in the European parliament was expelled from the eurosceptic Europe of Freedom and Democracy group for making racist remarks about her.

Mario Borghezio had attacked Kyenge for wanting to impose “tribal traditions” in Italy as member of a “bonga bonga” government, an apparent play on the so-called “bunga bunga” parties of former Prime Minister Silvio Berlusconi.

Opposition politician Calderoli, twice a cabinet minister under Berlusconi, is often offensive.

In 2006, he was forced to resign as reform minister after displaying a T-shirt mocking the prophet Muhammad during a state news broadcast. Later the same year, after Italy won the Football World Cup, he made racist comments about the French team.

While Italy had won the cup with ethnic Italians, France had lost because its players were “niggers, Muslims and communists”.

On Sunday, politicians, including some from his own party, lambasted Calderoli, with some calling for him to resign as Senate vice president. In an official statement and on Twitter, Prime Minister Enrico Letta said the comments were unacceptable.

“They go beyond all limits. Full solidarity and support to Cecile. Forward with your and our work,” Letta said.

Kyenge is campaigning to make it easier for immigrants to gain citizenship, and she backs a law that would automatically make anyone born on Italian soil a citizen.

Calderoli said he had no intention of resigning and offered only a qualified apology, saying it was “immediately clear to everyone present” that his comment was made in the context of a political rally, Ansa news agency reported.

“I did not mean to offend and if minister Kyenge was offended I am sorry, but my comment was made within a much broader political speech that criticised the minister and her policies,” he said.

Kyenge has not made an official statement, but she told AGI news agency that Calderoli should reflect on how he wanted to represent Italy as a senior Senate member.

“I don’t want to address Calderoli the person, but as a representative of an institution: Reflect on what you want to represent through your language,” she said.

(Editing by Louise Ireland)

Pierlugi Bersani, former center-left coalition leader  and Silvio Berlusconi

If you are wondering why the Italian Democratic Party wasn’t  able to win the elections, here’s a sample regarding the coherence of the  statements of the former Democratic Party leader:

“I didn’t want to make an alliance with Beppe Grillo, I’m not mad! I don’t admit the existence of parties or movements where only one person takes the decisions.” (Pierluigi Bersani, former chef of the Democratic Party).

The democratic Party is now allied with Berlusconi’s party (PDL). The former Italian Prime Minister is the undisputed leader of his party and of the center-right coalition since its foundation in 1994.

The ratings agency Standard & Poor's has downgraded Italy’s credit score by one place. S&P noted that the country's creditworthiness might well take a further hit in the not-too-distant future.

The New York-based agency announced on Tuesday that it was cutting the sovereign debt of Italy from BBB+ to BBB over worries that the country might not be able to absorb the effects of a worsening recession.

"The rating action reflects our view of a further worsening of Italy's economic prospects coming on top of a decade of real growth averaging -0.04 percent," S&P said in a statement.

S&P said that excessive rigidity in the Italian labor and product markets was the main reason for the country's poor economic performance. It said there was an expectation that gross domestic product (GDP) would shrink by 1.9 percent this year. A previous prediction was that GDP would shrink, but only by 1.4 percent.

There was further bad news, in that the agency gave Italy a negative outlook. That means it considered there was "at least a one-in-three chance that the rating could be lowered again in 2013 or 2014."

Big debts, little hope

The agency noted that a stagnant economy would make it more difficult for the Italian government to trim public debt, which currently stands at some 130 per cent of GDP. The figure is one of the highest among developed economies, S&P observed.

The International Monetary Fund (IMF) last week also cut its growth forecast for Italy. It said that the eurozone's third largest economy remained in a weak state and that unemployment was "unacceptably high."

Edward Snowden not on Bolivian president's diverted plane 

A jet carrying the Bolivian president is on its way home after being forced to land at Vienna airport because of the refusal of some European countries to let it pass through their airspace. Eva Morales was returning from a visit to Moscow. He called it "an excuse to scare, intimidate and punish me". 

The US government has admitted that it had been in contact with other nations about potential flights involving Edward Snowden, the NSA whistleblower. The State Department would not comment on whether it had made any specific respresentations over Morales's flight.

Bolivian and Austrian authorities insisted Snowden was not on the plane. The extent to which the Austrian police officers searched the jet was unclear.

An Austrian official told AP that Morales's aircraft asked controllers at Vienna airport to land because there was "no clear indication" that the plane had enough fuel to continue on its journey. 

Bolivia's UN ambassador has said that the country will file a formal complaint with the United Nations over the "kidnapping" of Morales. A number of South American leaders voiced outrage at the incident, including the Argentinian president Cristina Kirchner and Rafael Correa, the president of Ecuador.

Ecuador's foreign minister Ricardo Patino says Ecuador has found a hidden microphone inside its London embassy, where WikiLeaks founder Julian Assange is living, and it would disclose who controls the device. Patino described it as "another instance of a loss of ethics at the international level in relations between governments"

The Complete Coverage

Flight of the plane in real time

Source: The Guardian 

By Guy Dinmore in Rome

Italy’s judiciary has opened an inquiry into the Treasury’s use of derivatives to hedge public debt after reports that the state faced potential losses of billions of euros on contracts restructured during the eurozone debt crisis last year.
Nello Rossi, Rome’s deputy prosecutor, told the Financial Times on Wednesday that he would meet the various institutions involved, including the Treasury, the Bank of Italy and state auditors. He stressed, however, that this was not a criminal investigation.

The inquiry was prompted after a Treasury report was leaked to the FT and Italian daily La Repubblica detailing the restructuring of eight derivatives contracts in 2012.
Independent experts who examined the data concluded that Italy risked a potential loss on the contracts, based on market prices last week, of about €8bn on a total notional value of €31.7bn. Last year Italy said it had a derivatives portfolio totalling some €160bn, about 10 per cent of total state bonds in circulation.
Mr Rossi’s inquiry is assisted by the finance police who requested information on Italy’s derivatives contracts from the Treasury’s debt management office at the request of the Corte dei Conti, the state auditors.
Politicians said the inquiry was likely to run into a wall of secrecy surrounding the management of Italy’s €2tn of public debt, with the Treasury citing commercial confidentiality as a reason for not making public its derivatives contracts with the same banks that act as prime dealers in debt auctions.
“The state of Italy’s finances are like the formula for Coca-Cola. It is a secret,” said Renato Brunetta, spokesman for the centre-right People of Liberty, which formed a coalition government with prime minister Enrico Letta’s centre-left Democrats in April. “There is total opacity in the finance ministry,” Mr Brunetta added.

Earlier on Wednesday, the finance ministry dismissed as “absolutely groundless” reports in two newspapers quoting unnamed Italian officials that Italy had used derivatives in the late 1990s to “window dress” its accounts through upfront payments by foreign banks to meet financial criteria set by the EU for the country to enter the euro at its launch in 1999.
The ministry said its use of derivatives posed no risk to public finances and that the market value of such instruments, used to hedge against interest rate movements, could not be treated as an actual loss. It did not dispute the reported figures.
“It is a big misunderstanding. There is no loss,” Fabrizio Saccomanni, finance minister, said.
The ministry said it had provided finance police with requested information related to Italy’s payment of €2.57bn to Morgan Stanley in January 2012 after the US investment bank used a break clause to close a derivatives contract taken out in 1994.
Mario Draghi, head of the European Central Bank, referred reporters to the ministry’s statement when asked about the reports. Mr Draghi was head of the Italian Treasury from 1991 to 2001 before moving to Goldman Sachs, a US investment bank, in 2002.
In Brussels, Simon O’Connor, the European Commission’s economic spokesman, said the reports on Italy’s derivatives operations would not affect its evaluation of Rome’s current debt and deficit projections, saying Eurostat had thoroughly vetted Italy’s budget data as part of its normal semi-annual review process.
Commission officials also said that accounting rules in place when Italy was accepted into the euro were far less transparent with regards to derivatives than they are today.
“Italy was accepted into the euro on the basis of the rules that were in place at the time,” said Mr O’Connor.
Additional reporting by Peter Spiegel in Brussels

Source: Financial Times

MILAN (AP) — Former Premier Silvio Berlusconi faces a verdict Monday in his sensational sex-for-hire trial, charges that could bring an end to his two-decade political career.

Berlusconi is charged with paying an under-age Moroccan teen for sex and then trying to cover it up with phone calls to Milan police officials when she was picked up for alleged theft. Berlusconi and the woman deny having had sex with each other.
Prosecutors are seeking a six-year jail term and a lifetime ban from politics. Whatever the verdict, the sentence can't be effective until two appeals are heard, a process that can take months.

Berlusconi holds no official posts in the current Italian government, but remains influential in the uneasy cross-party coalition that emerged after inconclusive February elections. His decision to head the center-right coalition rather than move aside for younger leaders as he said he would boosted his forces to a second-place finish behind the center-left.

The charges against the billionaire media mogul stem from Berlusconi's infamous "bunga bunga" parties at his Milan area mansion, where he wined and dined beautiful young women while he was premier.
Neither Berlusconi nor the woman at the center of the case, Karima el-Mahroug, better known by her nickname Ruby, have testified in this trial. El-Mahroug was called by the defense but failed to show on a couple of occasions, delaying the trial. Berlusconi's team eventually dropped her from the witness list.
El-Mahroug did testify in the separate trial of three Berlusconi aids charged with procuring prostitutes for the sex-fueled parties. She told the court that Berlusconi's disco featured aspiring showgirls dressed as sexy nuns and nurses performing striptease acts, and that one woman even dressed up as President Barack Obama and the prosecutor in the sex-for-hire case, Ilda Boccassini.
Boccassini wasn't in court on Monday, but two other prosecutors were there as the judges began deliberating at 9:45 a.m.
El-Mahroug, now 20, said she attended about a half-dozen parties at Berlusconi's villa, and that after each, Berlusconi handed her an envelope with up to 3,000 euros ($3,900) in denominations of 500. She said she later received 30,000 euros cash from the then-premier paid through an intermediary — money that she told Berlusconi she wanted to use to open a beauty salon despite having no formal training.
She was 17 at the time of the alleged encounters. She has said she had claimed to be 24.
But she denied that Berlusconi had ever given her 5 million euros ($6.43 million). She said she told acquaintances and even her father that she was going to receive such a large sum "as a boast," but that it was a lie to make her seem more important.
The verdict garnered intense international media attention with half a dozen TV satellite trucks taking positions outside the court house. The verdict comes on the heels of Berlusconi's tax-fraud conviction, which along with a four-year prison sentence and five-year ban on public office, have been upheld on a first appeal.
The tax-fraud case is heading to Italy's highest court for a final appeal after Berlusconi's defense failed to derail it last week with a motion to the constitutional court arguing the trial court had made procedural a procedural error.
Berlusconi, who has been tried numerous times relating to his business dealings, has been convicted in other cases at the trial level. But those convictions have always either been overturned on appeal or the statute of limitations ran out before Italy's high court could have its say.

The sex-for-hire case is the first involving his personal conduct.