Italy is among the countries in Europe that have done the most since 2008 in terms of containing public deficits. A front that currently sees as many as twenty of the twenty-seven members of the European Union having opened an excessive deficit procedure against them in Brussels, the so-called "EDP" established pursuant to article 126 of the Treaty on the Functioning of the European Union and of the annexed Protocol no. 12. In the narrower circle of the euro area, twelve out of seventeen countries are subject to EDP. The members of the single currency in good standing are only Germany, Finland, Estonia, Luxembourg and Malta.
To get out of the excessive deficit procedure, Europe needs to be convinced of the sustainability of containing public deficits. It is not enough just to have respected the three per cent threshold in the last year. A path of rebalancing with more extensive roots needs to be demonstrated. From this point of view, Italy's numbers appear comforting. Added up for the five years from 2008 to 2012, the cumulative values of the ratio between the public deficit and GDP amount to twenty points for Italy against a euro area average of 23 points and at levels of twenty-eight and forty-five points for to France and Spain respectively.
In the most difficult five-year period for the economy since the end of the Second World War, Italy achieved an annual average ratio between public deficit and GDP of four per cent. In the same period, Spain accompanied the recession of the Iberian economy with a public deficit equal on average to nine percentage points of gross domestic product per year.
Rejoining the narrow circle of countries complying with the three per cent rule is an important step. Leaving aside Malta and Luxembourg, Italy will be the only country with a regular deficit placed outside the new Hanseatic league which today unites Berlin with Riga and Helsinki. The return of Rome will be a useful element in questioning the cliché of a fiscal "virtue" divided between the north and south of Europe or, worse, between the "centre" and "periphery" of the Union.
In practice, the closure of the infringement procedure could create the conditions for a further lowering of the spread between the BTP and the Bund. A spread that drops to 100 instead of 250 would result in lower interest expense, which can be estimated at around four billion euros within a year. The decreases in the spread, however, depend on many variables, including non-European ones. Beyond the variability of the markets, the promotion in the leading group of the virtuous will allow Italy to reopen the game on the so-called "golden rule" of public accounts.
The goal is to use the margins of flexibility provided for by the European Stability Pact to pre-deduct from the calculation of the deficit the costs of national co-financing of the structural funds and the resources for the fight against youth unemployment and for the large infrastructures necessary to relaunch a development sustainable. For Italy, the amounts in question would be significant.
It is an Italian and also a European problem. There is a great gap between austerity and growth that needs to be filled. Closing the infringement procedure concerning the public deficit represents a preliminary step for Italy. A further and much more decisive contribution will have to come from Europe, called to implement new ideas as well as additional resources. At European level, a "growth compact" and also an "industrial compact" are needed.
We need a primarily cultural paradigm shift in which we cannot, however, stand still. Beyond the macro, there are "micro" catalysts which, even in this very difficult economic situation, can help reduce the gap between austerity and recovery by working on a key factor such as innovation. Beyond the rhetoric, let's talk about start-up companies and business networks, for example. In recent years, both on start-ups and on business networks, "pro-growth" interventions have been made with a modest commitment to public finances but with considerable foresight. It is a road to insist on.
Between 2008 and 2012, the number of investments in "early stage" or new development initiatives in Italy rose from 208 to 506. In 2012 alone, the increase was thirty percent. Essential in this development is the risk capital and strategic and organizational skills contributed by the "business angels", largely entrepreneurs, freelancers or corporate executives still in business who, by subscribing a minority share of the capital, support the founding partners in the start-up phase of a business.
In the same way, the networks formed as a free aggregation of companies with the aim of increasing their competitiveness and innovation are increasing. In the space of just over two years, the number of companies involved in combinations set up pursuant to Law 33/2009 and following has risen from zero to over 3.300 units. Five hundred start-up companies and three thousand "network" companies are certainly few compared to the tens of thousands of companies that the recession has caused to close. However, they are a sign of the possibility of restarting. From now.
