ROME, July 9 (Xinhua) — Italy’s public debt will soar to 155.7 percent of its gross domestic product (GDP) in 2020, the Bank of Italy said in a report titled “The Italian Economy in Brief” published on Thursday.
For comparison, Italy’s public debt stood at 116.6 percent of GDP in 2009, at 135.4 percent in 2014, and at 134.8 percent of GDP in 2019, before the coronavirus pandemic and the ensuing national lockdown forced Italy’s economy to a halt.
In the first quarter of 2020, Italian national GDP contracted by 5.3 percent, household consumer spending dropped by 6.6 percent, exports were down 8 percent, and imports fell by 6.2 percent, according to the Bank of Italy report.
In response, on May 19, the government led by Prime Minister Giuseppe Conte rolled out a 55-billion-euro (62.3 billion U.S. dollars) spending package, ratcheting up the national debt in an effort to jumpstart the economy and tide over the country’s workers, families, and industrial base.
Named the Recovery Decree, the package contains extensive tax cuts and funding for businesses, public health, education, and the tourism sector.
Other leading European economies will also suffer huge forward jumps in their debt burdens. The eurozone overall will see its public debt advance by 16.7 percentage points, from 86 percent in 2019 to 102.7 percent this year, the Italian central bank said.
Italy is pushing for speedy approval of the proposed European Union (EU) Recovery Fund to aid the countries hardest hit by the pandemic ahead of a special EU summit to be held later this month.
Italy was the first European country to be hit by the global pandemic in late February. Enditem