Italy | A “dolce vita” revival is still too early to call

According to our analysis, reforms planned by Italy’s new Prime Minister Mario Draghi could reverse some of the lacklustre growth and debt sustainability problems that have plagued the economy for years. But as detailed proposals have yet to be revealed, let alone put into action, and Draghi’s reformist agenda will inevitably face stronger political opposition in the future, we maintain a wait-and-see approach.

What you will learn from this report:

  • Using our Global Economic Model, we have developed an upside scenario for Italy that assumes structural reforms are successfully implemented and maintained by future governments over the next decades.
  • According to our calculations, Italy’s GDP would be up to 12% higher and public debt lower at 120% of GDP by 2040. 
  • Draghi’s ambitious reform agenda will face enormous obstacles over the coming years, not least the pandemic-triggered health crisis, as well as the obvious risk that later governments will abandon the program.

Topics: Europe, Eurozone, Coronavirus, Recovery, Italy

Ipad Frame_Italy_RB_March 2021