Kurz and nine others were placed under investigation after raids at a number of locations linked to his conservative People's Party, the BBC reported. In a statement to the media on Saturday evening, Kurz said that he wanted to avoid months of chaos and stagnation, reports Xinhua news agency. He denies claims he used government money to ensure positive coverage in a tabloid newspaper, the BBC reported.
The allegations this week took his coalition government to the brink of collapse after its junior partner, the Greens, said Kurz was no longer fit to be chancellor. The Greens began talks with opposition parties, who were threatening to bring a vote of no confidence against the chancellor next week. Greens leader and Vice Chancellor Werner Kogler welcomed Kurz's resignation and indicated he would be willing to work with Schallenberg, saying they had a "very constructive" relationship.
"What's required now is stability. To resolve the impasse I want to step aside to prevent chaos," Kurz said as he announced his resignation. He said he would remain leader of his party, and continue to sit in parliament. "First and foremost, however, I will of course use the opportunity to disprove the allegations against me," he added. Regarding appointing Schallenberg as his successor, Kurz said that the Foreign Minister had the diplomatic skills necessary to rebuild trust between the parties.
Kurz has been facing increasing calls for him to step down, including from his own government allies, as the 35-year-old Chancellor and nine others have been under investigation over claims that government money was used in a corrupt deal to ensure positive media coverage. The opposition has called on Kurz to step down and has planned to take a no-confidence vote against him in Parliament on Tuesday. Kurz is the youngest head of government in the world, and being first elected to the position at the age of 31, the youngest Chancellor in Austrian history.