EU, Italy’s growth is “moderate”: GDP in 2016 expected at + 1.1% – The Republic

MILAN – The EU Commission sees continuing in Italy a “moderate growth” but revises downward the GDP in 2016: as reconstructed from Republic on newsstands, and confirmed by the Commissioner Pierre Moscovici during a press conference in Brussels, the 1.4% forecast in February now drops to + 1.1%. The government, in 2016 Def fired in mid-April, estimated for the current year by 1.2% recovery. “In the course of 2015 the pace of growth has slowed, leading to a lower than expected start-up of 2016,” which, “together with further slowdown in global trade, explains the downward revision” compared to winter weather, writes the EU in the forecast economic. In 2017 it has however confirmed the 1.3% growth, thanks to “more dynamic external demand and investment.” Again, there is a minimum difference with the prediction of the government for a GDP at + 1.4%.

Weather forecast for Italy to face: EU Commission winter, spring (the past) and Def 2016

	2015			2016			2017
	prim EU.	EU winter	Def 2016 (cons)	EU prim.	EU winter	Def 2016	prim EU.	EU winter	Def 2016
% annual GDP growth	0.8	0.8	0.8	1.1	1.4	1.2	1.3	1.3	1.4
annual inflation	0.1	0.1	0.1	0.2	0.3	0.2	1.4	1.8	1.5
rate unempl.	11.9	11.9	11.9	11.4	11 , 4	11.4	11.2	11.3	10.9
Deficit / GDP (%)	2.6	2.6	-2.6	2.4	-2.5	2.3	1.9	1.5	1.8
Debt / GDP (%)	132, 7	132.8	132.7	132.7	132.4	132, 4	131.8	130.6	130.9

the outlook for Italy. Presenting the Commission’s figures, Pierre Moscovici explained that the Italian growth in the coming years is primarily entrusted to the domestic demand. In the chapter of the EU document on the Peninsula, adding that “low inflation, employment growth and tax cuts” are supporting elements to the purchasing power of households and from there to private consumption. Asked at a press conference on the situation of the Italian government budget, particularly on structural correction of the accounts slowdown compared to the original objectives, Moscovici has glossed over: “No comment today.” He then merely noted that he met dozens of times Minister Pier Carlo Padoan, with which the dialogue continues in search of “an agreement on flexibility.” The judgment is then postponed to May 18.

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As for other numbers, go down “gradually” the rate of unemployment: the unemployment is expected to 11.4% this year and 11.2% next year, after recording 11.9% in 2015. the official recognition of the positive effect takes place later recorded to de-contribution for new employees indefinitely, while the slow descent of unemployment may impact the return of discouraged in the labor force, which is in itself a positive factor that alternates for the worse statistics.

Contrasting entries deficit and debt, which are the real theme of confrontation between Brussels and Rome. On the fiscal side, the document notes an improvement “marginal” of the structural budget of 2015; The read stability 2016 instead of expansive nature and therefore “the deficit / GDP falls only marginally (2.4% of the product) despite the fall in interest payments and the economic recovery.” 2.4% in 2016 is still an improvement compared to 2.5% reported last February, but is slightly above the 2.3% indicated by Def government. The outcome put black on white is the expectation for a worsening of the structural budget more than half a percentage point in 2016. But problems still more are likely to arrive in 2017, when the discrepancies are more sensitive : the deficit is estimated to date from Brussels is now at 1.9%, against 1.5% in the winter and 1.8% indicated by Def.

also Raise estimates debt , to 132.7% of GDP this year (by 132.4%) and 131.8% on 2017 (by 130.6%), a figure that still mark a decline. Sull ‘ Inflation , expected significant growth next year (1.4%), also weighs the possibility of VAT increase due to the safeguard clauses, which the government wants to defuse the forthcoming Stability and that would cost fifteen billion. The chapter of the Current expenditure , finally, Europe was affected by an increase of 1.5% also due to the resumption of upgrade contracts in Pa (for the years 2010 freeze), increase social costs; pension reforms instead lead to estimated savings of 1% per annum.

The Padoan alarm. On the difficult time of Europe, that still does not grow as we expect and undergoes numerous pressures – from Brexit risk to migrants – was expressed in no uncertain terms just the owner of the Italian Finance, according to which the Union is experiencing “an exceptional situation in which the risk is perhaps as never risked since It has been invented”. For Padoan, rather, the “questioning” of the Schengen Treaty is “more dangerous than the euro crisis a few years ago” because it “focuses on different national visions of Europe that are likely to prevail.” Commenting on the EU forecasts, however, Padoan stressed that “confirm the effectiveness of Italian politics.” The tenant MEF explained that Italy believes that “respect for the rules is fundamental to rebuilding mutual trust in Europe” yet still “to promote the evolution of the rules because they are more effective in addressing the problems before us, starting with the need to give answers to the citizens in terms of well-being and work. “

The general slowdown. The timid resumption of Italy is part of a general context on which they weigh “considerable risks”. The European Commission has reduced the estimate of growth in GDP this year compared to the beginning of February forecasts: in 2016 in the euro zone will grow by 1.6% and in 2017 by 1.8% from the previous 1.7% and 1.9%. The figure of inflation, despite new incentives launched by the ECB, has been adjusted downwards: Brussels now plans for this year 0.2% against the previous estimate of 0.5%, expanding by 1.4 prices % for 2017, against the previous + 1.5%.