Lower estimates for growth in Italy and Europe. In the summer economic forecasts presented today, the European Commission has revised Italian GDP growth downwards by 0.9 for this year and 0.8 for 2024, compared to the 1.2% and 1.1 of the forecasts spring presented in May. A figure that fits into a context of general slowdown in the EU economy, which falls to 0.8% in 2023, from the 1% expected in the spring forecasts, and to 1.4% in 2024, in line with the estimates for the Eurozone where growth will be 0.8% in 2023 (from 1.1%) and 1.3% in 2024 (from 1.6%). The decline in domestic demand, in particular in investments in construction, is driving Italian GDP lower, with the gradual reduction of Superbonus incentives. An elimination which, together with energy subsidies, is however viewed favorably by the European Commission. It must be said that the Belpaese had seen a recovery in the first quarter of 2023, only to then turn negative, with a drop of 0.4% in the second quarter that also surprised the EU. For the European Commissioner for Economy, Paolo Gentiloni, the decline in Italian growth should not be given “a particularly negative interpretation, because they are part of a context that concerns all European countries”.
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In addition to the drop in domestic demand, i.e. consumption, the sharp drop in Germany is weighing on the situation, going from +0.2 in previous forecasts to -0.4. The effects of the tightening of monetary policy then began to be felt, with the increase in ECB rates, “which affects the growth of all countries but which has a particular role in a country where investments in economy. The former prime minister says he is confident that “the Italian economy, as it has shown on many occasions, can react in a positive way” and responds with a lapidary phrase to all the criticisms raised by representatives of the Italian government and by itself Prime Minister Giorgia Meloni. “I don’t want to participate in controversies that I think will damage Italy”, she said at a press conference at the headquarters of the European Commission, rejecting the accusations of not doing enough for Italy, as if a European commissioner had to respond to the interests of the country that designated it. The Prime Minister had also spoken of a “curious stalemate” on the ITA dossier. An issue, Gentiloni pointed out to the Italian press, which is outside of his competence but which “is close to his heart” and which “in the the scope of the Commission’s collegial responsibilities, will try to address” given that it has dragged on for too long.
Next weekend in Santiago de Compostela there will be two important meetings for discussions on EU economic governance. In the informal Ecofin on Saturday, the Spanish presidency of the EU Council will try to find an initial synthesis of the various positions of the 27 on the reform of the Stability Pact. Here too the Commission invites it to be approved within the year to avoid the old rules coming back into force and even more so in light of the economic situation. “The Commission has put a balanced and advanced proposal on the table, which is in the interest of the European economy as a whole and therefore also in the interest of Italy”, underlined Gentiloni, also indirectly responding to the comments of those considering this proposal not favorable to Rome. On Friday, however, again in the city of San Giacomo, the finance ministers of the 20 countries of the euro zone will meet, who will give the OK to the appointment of Piero Cipollone, current deputy director general of the Bank of Italy, to the board of the ECB, at place of Panetta, who will lead Bank of Italy. Italy, however, will be in the dock for failure to ratify the new ESM treaty. “We expect Finance Minister Giorgetti to give a short update on what is happening in Italy and what to expect in the coming months on this issue,” a senior EU official said ahead of the meeting. “We are very well aware of the sensitivity around this issue in Italy and obviously we fully respect the parliamentary process, but we hope for a positive conclusion to the process as soon as possible.”
