By and  on April 12, 2006

MILAN — The specter of political turmoil in Italy — center-left leader Romano Prodi declared victory in the general election on Tuesday and Prime Minister Silvio Berlusconi refused to concede — generated concern in the fashion community about the impact on the industry and the country at large.

Voter turnout was a record 86.3 percent and provisional results gave Prodi's coalition control of both houses of Parliament. Berlusconi and his allies called for recounts, particularly of the absentee ballots that proved critical to the center-left's tenuous victory in the Senate.

Prodi's coalition held just two Senate seats more than Berlusconi's center-right alliance. In the lower house of parliament, or Camera dei Deputati, Prodi's group secured a majority by 67 seats. The results must be examined by a court before they can be certified, which could take days, or longer.

"It's big a mess," Stefano Gabbana said, echoing the concerns of many Italians.

Gaetano Marzotto, an industrialist and president of trade organization Pitti Immagine, compared the confusion to the George W. Bush-Albert Gore U.S. presidential contest in 2000. Despite early exit polls on Monday forecasting a clear Prodi win, late-night ballot counting ate into his lead. Prodi, 66, has been prime minister and European Union president.

"Obviously, it is not a good thing for a country," said Marzotto. "I hope we can avoid a prolonged situation. We need this government to be quick and authoritative so it can bring Italy out of this low point."

A new election law complicated ballot tallying. Berlusconi won the popular vote for the Senate, but took home fewer seats than Prodi's coalition.

While many members of the fashion community voiced support for Berlusconi when he was elected five years ago, reactions were more mixed this time. In 2001, the media tycoon was viewed as a pro-business candidate. But the prime minister's relations with the business community have come under strain — tension that's played itself out in the fashion world, as well.

Tod's president and chief executive, Diego Della Valle, became one of Berlusconi's harshest critics, accusing him of failing to stimulate new jobs or make companies more competitive. Della Valle could not be reached for comment.Domenico Dolce and Gabbana, however, have supported Berlusconi.

"What happened in the election is classic politics," said Gabbana, who expressed concern for the split in public opinion. "People get tired of one government and opt for a new one...under Berlusconi, there were positive results for entrepreneurs and Italian businesses."

Few Italians are ambivalent about Berlusconi, 69, the longest-governing prime minister in postwar Italy. Some praise his business savvy. Others cite the failure of the economy to grow last year, a debt load that exceeds gross domestic product and the conflict of interest caused by his ownership of Italy's three largest private television networks.

Mario Boselli, president of Italy's Camera Nazionale Della Moda, said the Berlusconi government failed to keep all its campaign promises, including to eliminate a regional corporate tax and make a series of structural reforms.

"Yes, something has been done over the past few years, on work flexibility for example, but it was definitely not up to our expectations," Boselli said.

Anticipating a possible Prodi government, fashion executives reiterated their requests for tax cuts, labor reforms and more concerted efforts to promote Italian exports. Some also voiced skepticism about a center-left government's ability to meet those priorities.

"The left wing may not necessarily be the answer to all the problems, as we've seen those politicians at work before and not much was done back then either," Boselli said, alluding to pre-Berlusconi governments. "There is not a lot of optimism out there, whether the left or the right rules. I really hope that the two main parties will rule together and accept one another's contributions. We've lost too much ground."

Umberto Angeloni, ceo of Brioni, also called for unity. "We're looking forward to some measures that would jump-start the economy, reduce the cost of labor and bring stability [instead of] confrontation," he said.

Marzotto stressed the importance of cracking down on tax evasion, a rampant problem in Italy, and making Italy more competitive through reforms, from "cutting some taxes to reducing the cost of labor to better energy prices."

Other executives downplayed the effect the political outcome will have on the fashion and business worlds."I am sure that notwithstanding the current political uncertainty ... the Italians will know what to do to relaunch our economy, and in particular the fashion industry, to reinforce Made in Italy throughout the world," said Patrizio Bertelli, Prada Group's ceo.

Santo Versace dismissed the political impact on fashion.

"It's a cultural problem, not a political one," Versace said. "People, the press, the cultural world should be made aware that fashion is important, as well as its image, all that it conveys — and this does not depend on the politicians."

With contributions from Luisa Zargani and Alessandra Ilari

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