Italy Sees 2019 Debt Reaching 132.6% of GDP, Repubblica Says
The Italian government will revise up its outlook for the country’s debt load this year as the economy barely grows, Repubblica reported, citing a draft of the Treasury’s new forecasts.
Debt is now seen rising to 132.6 percent of gross domestic product in 2019, the newspaper said, citing the draft predictions due for approval by Wednesday at the latest. That would be an increase from 130.7 percent projected in December and also exceeding the 132.1 percent reached at the end of last year.
The Treasury had to cut its output forecast for 2019 after the nation succumbed to a recession at the end of last year amid faltering global trade and a fall in business confidence. The government is set to approve an estimate of a 0.1 percent growth this year, two senior officials told Bloomberg this week.
Repubblica reported the 0.1-percent growth forecast for this year, saying the government is targeting 0.2 percent. It also said that the debt forecast for 2020 would be revised up to 131.7 percent from 129.2 percent previously.
Deputy Finance Minister Massimo Garavaglia told reporters in Cernobbio, northern Italy, that despite the economic slowdown, there is no reason at present for any adjustment in the budget for this year.
Commenting on remarks by European Commission Vice President Valdis Dombrovskis that weakening growth may force the country to freeze spending, Garavaglia said that any shortcoming in tax revenue would be offset by ad hoc funds set aside under the 2019 budget law to ensure Italy’s structural deficit target will be met.
“It’s what is in the legislation,” he said.
On April 9, the statistics office, Istat, will publish a review of the levels of GDP, deficit and debt for the past two years. In the past week, the agency said that the debt for 2017 and 2018 might be revised up slightly after the inclusion of liabilities of some state-controlled companies such as the railway operator.
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