Italy sees weaker 2024 GDP, with industrial sector in trouble, economy minister says
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Milan, Italy, July 6, 2023. REUTERS/Claudia Greco/
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ROME, Dec 12 (Reuters) - Italy will likely end this
year with an annual economic growth rate of 0.7%,
Economy Minister Giancarlo Giorgetti said on Thursday,
warning that the industrial sector risked slumping.
Speaking at a political event promoted by Prime
Minister Giorgia Meloni's Brothers of Italy party,
Giorgetti said the estimate was adjusted for the
number of days worked.
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The government in September set an unadjusted 1%
growth target for this year.
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Giorgetti said the
disappointing performance
of Germany's economy was weighing on Italy, adding
that the industry sector was the main cause of concern
for the government.
"We see signs of a nosedive," he said.
However, the GDP downward revision "doesn't change our
public finance targets," the minister added.
Italy hopes to bring its deficit below the European
Union's 3% of gross domestic product (GDP) ceiling in
2026 from 3.8 targeted this year.
Part of the lower-than-expected growth is also related
to
delays in spending
European Union's post-COVID recovery funds, which has
impacted the economy.
Italy is due to receive 194.4 billion euros ($203.81
billion) in cheap loans and grants from the bloc's
Recovery and Resilience Facility (RRF) by 2026, more
than any other state in absolute terms.
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Speaking at the same event on Thursday, EU Affairs
Minister Tommaso Foti said Italy wanted to replace
some planned projects that Rome will be unable to
complete by the 2026 deadline, with others that could
be wrapped up within the allowed timeframe.
"We are going towards a rescheduling next February,"
Foti said.
To support the economy, the government wants to cut
the IRES corporate tax for those companies that make
investments and new hirings under certain conditions.
The measure has an estimated cost of around 400
million euros, which Giorgetti said Rome planned to
cover by seeking an additional contributions from
banks.
Italy expects to
raise more than 5 billion euros
from the financial sector over the next three years
through a package of measures already included in the
government's 2025 budget.
($1 = 0.9538 euros)
Reporting by Giuseppe Fonte; Editing by Crispian Balmer
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