Italy's economic crisis: an overview
The world's economic crisis has certainly unsettled many countries, and Italy is no exception.
Continuous political issues, along with the Standard & Poor's downgrading of 2011, reiterated in 2013, when Italy has been sent down another notch (to a BBB+ grade), have only increased the fears of many Italians of not being quite out of the tunnel, yet.
Truth is, Bloomberg says, that the austerity measures applied by the Italian goverment to bring the country back within EU deficit standards may have made the situation even more tragic. At the time of the 2013 Standard and Poor' s downgrading (Summer 2013) Italy was into its eighth consecutive quarter of recession, and unemployment had reached levels unseen since 1977.
Although, at least officially, Italy has come out of the recession in the second half of 2013, the situation is still dire: in December 2013, ISTAT, Italy's national statistics office, has produced some worrying data: according to it, 30% of Italians, as many as a family over three, is at risk of poverty.
More alarming details, made public by La Repubblica last week, show that the Italian secondary sector has witnessed an evident increase of failing businesses (at leat 111 thousand Italian firms have filed for bankruptcy in 2013, 7.3% more than in 2012).
This is obviously affecting Italian citizens, who are trying to save money and spend as little as possible because of the negative forecasts. Lack of jobs and the ongoing difficulty for the younger generation to find a stable, well paid job, have worsened the situation further, so much so it is now believed the socio-economical position of Italy has gone back to that of 30 years ago.
It truly looks like an endless, vicious circle. The situation seems to follow a pattern of "crisis-no expenditure- more crisis": in fact, the problem has been exacerbated by the fact Italians have been spending far less than they used to: 2013 witnessed a drop of 2.1% in sales, the worst since the current calculation methods, applied for the first time in 1990, have been in use.
Is there any good news at all for Italy and her people? Maybe.
In spite of the gallopping economic issues, the country has been managing austerity better than others, especially thanks to the lower level of individual and family debt, and a banking structure that had never fully endorsed crazy lending policies. The last trimester of 2013 has also shown, in spite of the general negative pattern of the full year, slight improvements in the overall economy, which has been considered by expert as a positive sign of economical pick up.
Italy is clearly not going through an easy historic period, and happier, more stable days seem still far. However, as history has taught us, there are always difficult economic and financial problems affecting a country; thus, measures encouraging employment and the domestic economy are urgently needed to solve the country's problems and that is what the Government is working on. Let's hope happier moments will come soon and that these hard times will only be a memory.
Edited and updated by Francesca Bezzone, 08/03/2014
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