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Monti aims to reduce debt, boost growth

Wednesday, January 18, 2012 - 02:21

Jan. 18 - Italian Prime Minister Mario Monti has met with his British counterpart David Cameron to discuss promoting growth, at a time when Britain's unemployment has hit a 17-year high and Italy is trying to get its debt under control. Joanna Partridge reports.

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Italian Prime Minister Mario Monti continues his tour of Europe as he meets his British counterpart David Cameron. The visit comes at a time both leaders, like their European neighbours, are concerned about their own economies, and Europe's. In Britain, umeployment hit its highest level in 17 years in November - 8.4% of the workforce, although joblessness is much worse at just over 22% among 16-24 year olds. But the number of people claiming benefit for being out work slowed in December, leading to some hope the labour market downturn might be flattening off. But top of agenda at Monti and Cameron's meeting was the euro zone debt crisis. Monti's government has implemented a series of austerity measures and structural reforms in the last two months to get its debt under control and make the country more competitive. But he says euro zone members are working together to find a solution. SOUNDBITE: Italian Prime Minister Mario Monti, saying (Italian): "Efforts continue, and governance must be improved, from the point of view of budget discipline and also from the point of view of firewalls to calm or end the tension in the markets about the possibility of contagion and most importantly from the point of view of politicians to promote growth." After seeing Cameron, Monti also held a meeting behind closed doors with financiers and investors - aimed at whipping up some international appetite for Italy's government debt. Rome's 10-year bond yields have fallen slightly in recent days, but it still has to refinance 36 billion euros of debt in February, says Michael Hewson from CMC Markets. SOUNDBITE: Michael Hewson, Senior Market Analyst at CMC Markets, saying (English): "I think when you've got bond yields around six-and-a-half or seven percent, I think you've really got to be worried about the long-term capability of Italy to service its debt pile this year." One of Monti's main aims is to stimulate Italy's sluggish economic growth, by boosting competition and liberalising some sectors. Back home, taxi drivers went on strike over some of his planned reforms. They fear plans to increase the number of cab licenses will damage their business. And analysts say the strength of the trade unions in Italy is also going to make it harder for Monti to implement the reforms needed to get the country on the road to growth. Joanna Partridge, Reuters

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Monti aims to reduce debt, boost growth

Wednesday, January 18, 2012 - 02:21