Political tensions are evident and represent a risk to the economic outlook. The warning comes from the IMF which in Article IV drawn up at the end of the mission in Italy states that the government of Enrico Letta "maintains the support of parliament" but "the tensions within the coalition are evident and represent a risk to the economic". "The government continues to pursue a reform agenda but is facing political limitations", writes the IMF which appreciates the "sustained fiscal adjustments despite a difficult growth context", which have made it possible to achieve one of the higher primaries in the euro area and boost confidence. For the IMF now "we need to identify measures that balance the loss of revenue with the proposed abolition of the IMU".
Thanks to the "important steps" taken by the Italian authorities to ensure fiscal sustainability and implement structural reforms, according to the IMF, growth is "stabilising" but it is necessary to go ahead with the reforms, because without profound structural reforms average growth term will remain low.
THE FORECASTS ON THE DEFICIT, GDP AND DEBT
The estimates released today by the Fondo per l'Italia indicate a deficit of 2013% in 3,2 and 2,1% in 2014. Debt, on the other hand, will rise from 127% of GDP last year to 132,3% this year. year and 133,1% the next. On the growth front, a modest recovery is expected starting at the end of 2013, supported by net exports. The Italian GDP, after the contraction of 2,4% in 2012, should mark a -1,8% in 2013 and +0,7% in 2014. Inflation should settle at 1,6% in 2013 and all '1,3% in 2014. After the decline of previous years, "domestic demand should recover slowly" in light of the headwinds resulting from the difficult credit conditions.
Labor and justice reforms remain at the heart of the agenda, crucial for Italian growth: it is necessary "to improve the labor market, open up the energy sector and liberalize services". But also reduce public debt through timely implementation of the privatization agenda.
STRENGTHEN BANKS, BANKITALIA HAS THE POWER TO REMOVE DIRECTORS
For the Fund led by Christine Lagarde, Italian banks have strengthened their capital position but remain vulnerable to the weak economy: the system is now more stable but not out of danger, it is necessary to go ahead with the measures already started by the Bank of Italy and strengthen budgets. It is also necessary to strengthen the governance of popular foundations and institutes. "Foundations - she says - are a stable long-term shareholder of banks, but their peculiar governance structure and inadequate supervision create risks" while popular institutions should be encouraged to transform themselves into joint stock companies.
And on the MPS case he states: "it is a systemic bank and its recovery is crucial", the "successful implementation of the ambitious restructuring plan is crucial not only for the bank but for the system as a whole".
Finally, the IMF is also pressing Bank of Italy's powers, asking that Via Nazionale be given "the power to remove one or more directors" of the credit institutions.
