Italy’s debt this year will exceed its previous record as a result of World War I, causing the debilitating cost of the coronavirus epidemic to the third largest economy of the copper region. euro.
The new loan that counts 159.8% of the gross domestic product given in the fiscal outlook was approved by Prime Minister Mario Draghi’s cabinet on Thursday. This exceeds the probable all-time high of 159.5% achieved in 1920, just before the era of Benito Mussolini’s fascist dictatorship.
The economic update also confirmed a forecast of 4.1% lower growth this year, with a target of 4.5% after the stimulus and other measures are included, according to a government official. It forecasts a budget deficit of 11.8%, increasing borrowing by billions of euros to protect people and businesses from the catastrophe of the pandemic.
These numbers represent the first full set of economic forecasts compiled since Draghi led the response to the Italian coronavirus, which killed more than 115,000 people and led to the incidents. The shutdown has cut off key industries like tourism. The government has agreed to borrow 40 billion euros ($ 48 billion) for the new stimulus measures, pushing the country’s overall pandemic spending to more than 170 billion euros.
Currently, Italy’s spending is backed by the European Central Bank, which is buying government bonds to keep cross-country spreads under control and make pandemic debt less expensive. significantly less.
With austerity being pushed down to a level that allows the government to focus on rebuilding the economy, the growth recovery spurred by national stimulus measures and the European Union will assist. Italian finances, starting next year.