Two government sources said Italy’s pandemic-stricken economy is expected to grow by more than 5% in 2021 after shrinking 9% this year. The government coming from the anti-establishment 5 Star Movement party and the centre-left Partito Democratico party released a forecast showing a fall of 8% GDP this year and a 2021 rebound of 4.7%. The new projection along with public finance forecasts will be announced next week, as a framework, supporting the mid-October 2021 budget presentation to the European Commision.
On the other hand, the country ranked third in the euro zone’s largest economy has not seen GDP annual growth of 5% for more than 4 decades. The upcoming forecast that is still to be finalised also based on an unchanged policy scenario, as the expansionary measure plan that would be financed by the European Union’s Recovery Fund will not be incorporated, the media sources said. It is estimated that some 209 billion euros ($247 billion) in grants and soft loans by 2023 from the fund that is designed to help the European Union nations severely blown by the Coronavirus pandemic.
Economy Minister Roberto Gualtieri said that the country is aiming to present the National Recovery and Resilience Plan which will front-load around 10% of the spending to the European Commission early next year. And among the under-discussion projects, Italian government wants to upgrade its rail lines, establish ultra-fast broadband network, and strengthen the country’s healthcare system by spending a total of more than 30 billion euros in six years. In recent published paper this week, the government said the reforms funded by Europe could support as much as doubling its growth rate, increasing birth rate which ranked one of the world’s lowest, and narrowing its north-south divide.
