Brussels, 30/05/2014 (Agence Europe) - In a speech to the Italian parliament on Wednesday 28 May, the country's finance minister, Pier Carlo Padoan, talked about a three-pronged growth stimulus approach at EU level.
Padoan called for a boosting of the EUROPE 2020 initiative that was introduced in March 2010 in seven key areas - innovation, the digital economy, employment, youth, industry, poverty reduction and efficient use of resources. He said that there should be a stronger and clearer link between the goals and the available instruments through deepening the single market and supporting transatlantic trade integration deals. The EUROPE 2020 strategy is currently the object of a public consultation exercise that closes in October (see EUROPE 11072).
For the economy, Padoan recommends better exploration of the potential for structural reforms in combination with higher-quality budget consolidation. Padoan, who used to be an OECD economist, approves of the use of financial funding (such as the new financial rules and resources for the EIB) to leverage public investment and attract private investment.
On 1 July 2014, Italy takes over from Greece at the helm of the EU Council of Ministers. The Partito Democratico's landslide victory in the European elections provided the Social Democrat prime minister, Matteo Renzi, with the opportunity to have influence in the debate about the European Commission's action in 2014-2019 at the recent summit (see EUROPE 11089). Renzi wants a stability and growth pact that provides preferable treatment for investment to boost growth but does not disagree with the SGP's objectives. Italy is no longer subject to excessive deficit proceedings.
On Wednesday, Italy's statistical body, Istat, presented a mixed picture of the Italian economy, indicating in its annual report that the main risk factor for the country's public debt was the low GDP growth and the gap between interest rates and growth.
Like the European Commission, Istat forecasts growth of 0.6% of GDP in Italy in 2014, compared with 0.8% according to the Italian government. Public debt is expected to reach 134.9% of GDP (135.2% according to the Commission), compared with 132.6% in 2013.
Welcoming the fact that Italy is the only eurozone nation able to achieve a primary budget surplus (not including debt-servicing costs) of over 2% of GDP, Istat noted the negative effect of austerity and restrictive fiscal manœuvres (€75 billion in 2012 and €93 billion in 2013). (MB)