Italy, which was already experiencing slower growth than the European average, was strongly hit by the global crisis, its economy shrinking by 5% in 2009. After resuming growth in 2010, the Italian economy again sunk into recession in the second half of 2011 and contracted by 2.3% in 2012 dues to a drop in demand. Atmosphere of uncertainly, finanical restrictions and fiscal consolidation measures have had a very negative impact on consumption and investment. The recession should continue in 2013, although it should be less severe (-0.7%).
Despite reforms, the Italian economy has now entered recession, especially due to a drop in domestic demand, which has not been offset by stronger foreign demand. The economy is weakened by a colossal state debt (over 125% of the GDP) and at the end of 2012, the country also experienced governmental crisis: the government resigned and new elections were called for 2013. The temporary cabinet of Mario Monti planned to pursue austerity measure as part of the 2013 budget, aiming to restore market confidence. Priority has been given to fighting fiscal evasion and illegal economy. An increase in taxation, pension reform and labour market reform are also to be implemented.
The unemployment rate, which increased since the global financial crisis, is now at around 11%, which does not include partial unemployment. Young people have been the hardest hit, with a rate of unemployment close to 30 %. Regional inequalities betweent he highly industrialized and dynamic North and the poor rural southern Mezzogiorno areas are high and organized crime remains a problem.
|Main Indicators||2009||2010||2011||2012||2013 (e)|
|GDP (billions USD)||2.00||2.00||2.00||2.00e||2.00|
|GDP (Constant Prices, Annual % Change)||-5.5||1.7||0.4||-2.4e||-1.8|
|GDP per Capita (USD)||35,251||34,126||36,227||33,115e||33,909|
|General Government Balance (in % of GDP)||-4.1||-3.6||-3.5||-1.3e||-0.2|
|General Government Gross Debt (in % of GDP)||116.4||119.3||120.8||127.0e||132.3|
|Inflation Rate (%)||0.8||1.6||2.9||3.3e||1.6|
|Unemployment Rate (% of the Labor Force)||7.8||8.4||8.4||10.7||12.5|
|Current Account (billions USD)||-42.03||-72.56||-67.41||-10.65e||6.56|
|Current Account (in % of GDP)||-2.0||-3.5||-3.1||-0.7e||-0.0|
Source: IMF - World Economic Outlook Database - Last Available Data.
Note: (e) Estimated Data
The agricultural sector contributes to approximately 2% of the Italian GDP. Italy is the biggest European producer of rice, fruits, and vegetables, as well as the world’s biggest wine producer and exporter. The country is one of the major agricultural players in the European Union. Yet, Italy has limited natural resources. The country must import most of the raw materials required for production and more than 80% its energy.
The Italian fabric industry is mostly composed of small and medium family businesses. More than 90% of industrial companies have less than 100 employees, thus lowering the country’s competitiveness in the global market. Luxury goods (haute couture, cars, gourmet food items) play an important role in Italian industry. The country is the premier exporter of luxury goods. Precision machinery, motor vehicles, chemical products, pharmaceuticals, electrical items, fashion, and clothing make up its major industries.
The service sector contributes to 70% of the GDP. Tourism plays a major role, making Italy the third biggest tourist attraction in Europe, after France and Spain.
|Breakdown of Economic Activity By Sector||Agriculture||Industry||Services|
|Employment By Sector (in % of Total Employment)||3.7||28.5||67.8|
|Value Added (in % of GDP)||1.9||25.3||72.8|
|Value Added (Annual % Change)||1.0||2.9||1.8|
Source: World Bank - Last Available Data.
Find more information about your business sector on our service Market reports.
The Economic freedom index measure ten components of economic freedom, grouped into four broad categories or pillars of economic freedom: Rule of Law (property rights, freedom from corruption); Limited Government (fiscal freedom, government spending); Regulatory Efficiency (business freedom, labor freedom, monetary freedom); and Open Markets (trade freedom, investment freedom, financial freedom). Each of the freedoms within these four broad categories is individually scored on a scale of 0 to 100. A country’s overall economic freedom score is a simple average of its scores on the 10 individual freedoms.
The world rankings, published annually, measures the violations of press freedom worldwide. It reflects the degree of freedom enjoyed by journalists, the media and digital citizens of each country and the means used by states to respect and uphold this freedom. Finally, a note and a position are assigned to each country. To compile this index, Reporters Without Borders (RWB) prepared a questionnaire sent to partner organizations,150 RWB correspondents, journalists, researchers, jurists and activists of human rights, including the main criteria - 44 in total - to assess the situation of press freedom in a given country. It includes every kind of direct attacks against journalists and digital citizens (murders, imprisonment, assault, threats, etc.) or against the media (censorship, confiscation, searches and harassment etc.).
The Indicator of Political Freedom provides an annual evaluation of the state of freedom in a country as experienced by individuals. The survey measures freedom according to two broad categories: political rights and civil liberties. The ratings process is based on a checklist of 10 political rights questions (on Electoral Process, Political Pluralism and Participation, Functioning of Government) and 15 civil liberties questions (on Freedom of Expression, Belief, Associational and Organizational Rights, Rule of Law, Personal Autonomy and Individual Rights). Scores are awarded to each of these questions on a scale of 0 to 4, where a score of 0 represents the smallest degree and 4 the greatest degree of rights or liberties present. The total score awarded to the political rights and civil liberties checklist determines the political rights and civil liberties rating. Each rating of 1 through 7, with 1 representing the highest and 7 the lowest level of freedom, corresponds to a range of total scores.
Any Comments About This Content? Report It to Us.
© Export Entreprises SA, All Rights Reserved.
Last Updates: December 2013