Xinhua , Rome:
Economic analysts of Italy’s leading industrial association Confindustria Thursday revised down growth forecasts of the country that they described as on the razor’s edge between recovery and stagnation.
Confindustria’s research center (CSC) in a report presented in Rome on Thursday cut Italian gross domestic product (GDP) forecast for 2014 from 0.7 percent to 0.2 percent and forecast for 2015 from 1.2 percent to 1 percent.
“The country is at a crossroads between signals of confidence in the recovery and expectation of reforms and the risk of a reduction in development potential that tends to translate into stagnation,” Confindustria’s Chief Economist Luca Paolazzi said when presenting the report.
Italy’s economy began a recovery in the fourth quarter of 2013 with a 0.1 percent growth but returned to 0.1 percent negative growth in the first quarter of this year.
“The illness of slow growth has not been eradicated, and the patient is weak and struggling to respond to the treatments,” the CSC said.
The Confindustria analysts underlined “how far” Italy has fallen since the outbreak of the economic crisis in 2007: GDP was down 9 percent, industrial production fell by 23.6 percent, household consumption diminished 8 percent, investments dropped 27.5 percent and employment decreased 7.8 percent.
Currently there were 3 million more poor people in the country when compared with 2007, a 93.9 percent rise, and 3.7 million more jobless people, a 122.3 percent rise, they noted.
In this scenario, the report added, “a political shock” would be necessary to stimulate the Italian economy which needed reforms to stimulate growth and balance the recent austerity policies.
Commenting on the report, Confindustria Head Giorgio Squinzi said, however, that despite the poor figures “Italy was no longer on the edge of the abyss” as “a political cycle of reforms has been started that seems to finally have stability.” The country “has all what it takes” for recovery, he stressed.
The center-left government of Prime Minister Matteo Renzi, which has forecast a 0.8 percent GDP growth for this year, is at work on an intense program of economic and institutional reforms including a tax credit bonus for low earners, public spending cuts and simplification of the state machinery.
Economic analysts of Italy’s leading industrial association Confindustria Thursday revised down growth forecasts of the country that they described as on the razor’s edge between recovery and stagnation.
Confindustria’s research center (CSC) in a report presented in Rome on Thursday cut Italian gross domestic product (GDP) forecast for 2014 from 0.7 percent to 0.2 percent and forecast for 2015 from 1.2 percent to 1 percent.
“The country is at a crossroads between signals of confidence in the recovery and expectation of reforms and the risk of a reduction in development potential that tends to translate into stagnation,” Confindustria’s Chief Economist Luca Paolazzi said when presenting the report.
Italy’s economy began a recovery in the fourth quarter of 2013 with a 0.1 percent growth but returned to 0.1 percent negative growth in the first quarter of this year.
“The illness of slow growth has not been eradicated, and the patient is weak and struggling to respond to the treatments,” the CSC said.
The Confindustria analysts underlined “how far” Italy has fallen since the outbreak of the economic crisis in 2007: GDP was down 9 percent, industrial production fell by 23.6 percent, household consumption diminished 8 percent, investments dropped 27.5 percent and employment decreased 7.8 percent.
Currently there were 3 million more poor people in the country when compared with 2007, a 93.9 percent rise, and 3.7 million more jobless people, a 122.3 percent rise, they noted.
In this scenario, the report added, “a political shock” would be necessary to stimulate the Italian economy which needed reforms to stimulate growth and balance the recent austerity policies.
Commenting on the report, Confindustria Head Giorgio Squinzi said, however, that despite the poor figures “Italy was no longer on the edge of the abyss” as “a political cycle of reforms has been started that seems to finally have stability.” The country “has all what it takes” for recovery, he stressed.
The center-left government of Prime Minister Matteo Renzi, which has forecast a 0.8 percent GDP growth for this year, is at work on an intense program of economic and institutional reforms including a tax credit bonus for low earners, public spending cuts and simplification of the state machinery.
