Martedì, 23 Ottobre 2018

Italian government struggling with deficit, debt challenges


Rome, March 21 - The Italian government Thursday
raised its deficit targets and said it would also increase debt
to help boost its flagging economy.
The outgoing government, led by caretaker Premier Mario
Monti, raised its deficit target for 2013 to 2.9% of gross
domestic product - a dramatic increase from its earlier target
of 1.8% of GDP.
It also slashed its economic forecasts for 2013, predicting
a 1.3% contraction, compared with an earlier prediction of a
0.2% fall in GDP.
Next year will see an improvement, with Italy's economy
expanding by 1.3%, Italian Finance Minister Vittorio Grilli
That's slightly higher than a previous forecast of 1.1%
growth in 2014.
To meet all of its commitments, including social spending,
the government announced plans to increase debt by 40 billion
euros this year and next.
"We will increase debt by 20 billion euros in 2013 and 20
billion euros in 2014," Grilli told reporters.
The new money is expected to "stimulate" the
recession-plagued Italian economy, added Grilli, whose
government should soon be replaced by politicians elected in
late February.
However, a political logjam continues in Rome as the three
parties that gained the most votes struggle to find some way to
work together to form a new government.
No single party gained enough power to control the new
government and have been meeting Wednesday and Thursday with
President Giorgio Napolitano to hash out a political compromise.
The increase in debt was made possible after the European
Commission (EC) in Brussels gave Italy more flexibility in its
national debt levels despite a stability pact signed by nations
including Italy that fixed those debt levels.

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