Recession in Italy keeps biting
Tue Mar 5, 2013 9:0AM
Italy's crisis-hit economy is under mounting pressure. The recent elections in the country have diminished hopes for a stable government---one which could introduce measures to tackle recession, soaring unemployment and one of the world's biggest public debts.Recession in Italy keeps biting hard and all sectors seem to have been gravely affected. The national bureau of statistics (ISTAT) announced that Italy's real gross domestic product dropped below its 2001 level last year and that the nation's debt-to-GDP ratio surged to 127 per cent in 2012. ISTAT also added the tax burden escalated to a record 44 per cent. As a result around 1,000 businesses closed each day last year. The recession has also driven up unemployment to record levels in Italy. In January, overall unemployment rose to almost 12 per cent and youth unemployment nearly reached 39 per cent; the highest monthly rates for both since the national bureau of statistics started issuing monthly figures in 2004. Italy's massive national debt recently climbed to over two trillion euros. While outgoing prime minister Mario Monti's painful reforms are set to reduce public waste, significant growth-boosting measures are now desperately needed. However recent general elections have produced a political stalemate and it will be very hard to try to revive the Italian economy without a stable government. Italy's President Giorgio Napolitano will not begin formal consultation with political leaders until March 18. The anti-establishment Five Stars Movement has already warned it will not make alliances with any parties. The task of trying to find a coalition government to rule Italy is likely to turn out extremely difficult for Napolitano.