ROME Feb 22 The European Commission forecast on
Friday Italy's recession would be worse this year than previous
estimates showed, underlining the scale of the challenge facing
the government to be elected this weekend.
Italy's economy will shrink 1 percent in 2013, the EU's
winter forecast said, double its November estimate of a 0.5
percent fall. This compares to a forecast of -0.3 percent for
the euro zone, showing Italy continues to lag its partners.
Austerity-weary Italians vote this weekend for the
successors of a technocrat government led by economist Mario
Monti, which introduced taxes and spending cuts to pull Italy
from the brink of a Greek-style financial meltdown.
The commission's forecast is in line with Bank of Italy
estimate that also sees a fall of 1 percent of GDP this year,
but is more pessimistic that the government's forecast for a 0.2
percent decline in GDP this year.
The commission also hiked its unemployment forecasts for the
country, predicting the unemployment rate would rise to 11.6
percent this year and 12 percent in 2014.