(Reuters) Confindustria significantly improves its estimate of Italian GDP for this year and raises that of 2018, photographing an acceleration of the economy linked to exports and investments, but warns that the global picture is becoming less favorable and that next year's general elections will push businessmen to caution.
The Confindustria Study Center (Csc) raises the 2017 GDP estimate to 1,3% from the 0,8% estimated in December. A revision, explains the report "Economic Scenarios", due for two thirds "to the higher statistics released by Istat, one third incorporates the further increase in the qualitative indicators which suggests more robust increases than previously expected in the central quarters".
The GDP of the second and third quarters are seen respectively at +0,3% and +0,4% cyclical.
The 2018 GDP is seen to rise by a tenth of a point, to 1,1%, even if the CSC warns that the estimate does not incorporate the necessary manoeuvre: “Even if it were contained at 8 billion (thanks to further European flexibility), it would lower the increase in GDP below 1%”.
It also improves the judgment of Standard & Poor's which revised its estimates up to 1,2% from +0,9%.
The government aims to close this year with a growth of 1,1%, and the target for 2018 is 1%.
The acceleration of the economy is due to exports (estimated to grow by 4,6% this year and 3,9% next) and investments. The lack of braking elements also contributes: the deadlock in world trade in 2015-2016, the credit crunch, the deep crisis in the building sector and the reverses for deficit reduction.
However, Confindustria warns: the picture will gradually become "less favourable, margins have already started to decrease", and in 2018 "fears about the electoral outcome will tend to make corporate decisions more prudent", explains Luca Paolazzi, director of the csc.
And if the growth differential with the rest of the eurozone countries is halved, "it still remains not small", the report points out.
The CSC sees the deficit/GDP ratio at 2,3% this year (from 2,5%) and at 2,4% next (from 2,6%). The debt is revised to 133,2% in 2017 (from 133,4%), while the estimate for 2018 remains unchanged, at 133,7%.
The unemployment rate this year is given at 11,2% (from 11%) and at 10,7% in 2018 (from 10,5%).
