As Italy Forms Anti-Establishment Government, Row Erupts with EU

Only a few minutes after the announcement on Thursday of a deal on a new anti-establishment government in Italy, one of its leaders attacked a top European official for comments he deemed racist in a fresh sign of difficult relations with Brussels.

In a conference earlier on Thursday, the president of the European Commission, Jean-Claude Juncker, was reported saying that Italians had to work more and fight corruption to improve the situation in the country's impoverished south.

Shortly after the new government backed by the anti-establishment 5-Star and the far-right League was announced , League leader Matteo Salvini called Juncker's remarks "shameful and racist."

"The new government will make sure that the rights and the dignity of 60 million Italians will be respected," Salvini said in a statement, adding that "Italians expect from Europe cooperation and not insults."

A spokeswoman for Juncker said later that the comments attributed to him were taken "out of context."

"President Juncker was referring to the structural problems of the region of south Italy where the EU has done a lot to mobilise EU funding to spur growth and jobs. The absorption of EU funds could be improved so that people can feel the results on the ground more swiftly," the spokeswoman said in a statement.

The commission has proposed this week to increase European Union funding for Italy's poorest regions in the next EU long-term budget for 2021-2027.

Juncker's alleged comments on Italy's southern regions were made in a closed-door meeting, the spokeswoman said, after a public session in which he praised the "genius" of the Italians.

After the alleged remarks were reported in top Italian news websites, the Italian president of the European Parliament, Antonio Tajani, urged Juncker to deny remarks that he deemed "unacceptable," opening a new front in Italy's increasingly complicated relations with its EU partners.

The row comes two days after the German commissioner for the EU budget, Guenther Oettinger, was forced to apologise after comments suggesting Italian voters would be punished by markets for voting for eurosceptic populists caused an uproar in the country.

Among members of the new government, which is due to be sworn in on Friday, is economist Paolo Savona, who devised a plan for Italy's departure from the euro zone.

Savona denied that the new government would seek to dump the euro. He was moved to the role of minister for the relations with the EU, after Italian President Sergio Mattarella vetoed his appointment as finance minister.