Italy PM Letta's rival Renzi calls for new government

Matteo Renzi and Enrico Letta Mr Renzi (left) is eight years younger than Mr Letta and has been a rising star in their Democratic Party

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Matteo Renzi, political rival of Italy's Prime Minister Enrico Letta, has called for a "new government".

Mr Renzi, 39, is the leader of Mr Letta's Democratic Party and made the remarks during a party meeting in Rome.

There have been days of speculation that Mr Renzi wants to take over the post of prime minister.

If Mr Renzi's proposal is approved by the party leadership, analysts say Mr Letta may have to resign as early as Thursday evening.

There is a growing sense that the party is likely to back Mr Renzi, the BBC's Alan Johnston reports from Rome.

Analysis

Matteo Renzi is a politician in a hurry. He personifies the frustration felt by many Italians at the apparent inability of his country's leaders to deal with Italy's rapid economic decline, which has led to the impoverishment of an ever growing number of families.

He is under 40, charismatic, smart and - in his own words - "hugely ambitious". That is his strength.

But he also has his weaknesses. He has so far had a career only in local politics in his native Florence, and lacks experience in Rome's Byzantine political arena. He has never been elected to parliament and has no popular mandate.

According to opinion polls, most Italians would prefer him not to take over the reins of government from Enrico Letta, the much lower-key prime minister who has run the country for the past 10 months.

If he does succeed Mr Letta, he will inherit an uncomfortable and unwieldy coalition including both centre-left and centre-right parties.

Relations between the two men have become increasingly fraught, our correspondent adds.

Way out of 'morass'

Mr Letta, 47, formed a coalition with the centre-right last year but there had been mounting speculation over his future after Mr Renzi was elected party leader in December.

Mr Letta has reportedly cancelled a trip to the UK scheduled for later this month.

He had previously said he was unwilling to resign.

"You don't step down because of gossip, because of power plays and behind-the-scene activities," the prime minister said hours after a face-to-face meeting with Mr Renzi in Rome on Wednesday.

Mr Letta did not attend Thursday's party meeting, which had been brought forward from next week.

Mr Renzi thanked Mr Letta for his "remarkable work" but said the country could not go on in "uncertainty".

Matteo Renzi arriving at Thursday's meeting Mr Renzi (left), arrived at Thursday's meeting amid a scrum of reporters

He said his proposal - a new government to take over until the end of the current parliamentary term in 2018 - was a way out of the "morass".

He has previously accused Mr Letta of a lack of action, with unemployment at its highest level in 40 years and the economy shrinking by 9% in seven years.

Correspondents say that although the prime minister has kept a careful lid on public expenditure, he has not been able to carry out much-needed administrative reforms and stimulate economic growth.

The latest political turmoil has so far had little impact on financial markets, in contrast with the volatility seen before the current coalition was formed.

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