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Is Italy the new sick man of Europe?

Thursday, September 15, 2016 - 01:30

Italian employers group Confindustria has trimmed its growth forecasts and said it would take more than 10 years to return to pre-crisis economic output at the current rate of expansion. Ivor Bennett reports

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Rome's Colosseum is used to scenes of battle. The latest - a public art installation that supposedly depicts fear. A fitting symbol perhaps given the state of Italy's economy. SOUNDBITE (English) MIKE INGRAM, MARKET STRATEGIST, BGC PARTNERS, SAYING: "Well I've often described France as the sick man of Europe. but you can say that at least the economy there is still 4 percent bigger than it was during the first quarter of 2008. The Italian economy is 9 percent smaller." Italy was by no means considered a thoroughbred before 2008. But even getting back to that position won't be easy. One employers lobby says it'll take at least 12 years. The influential Confindustria group also revising its growth forecast down for this year to 0.7 percent. The government is more optimistic. But it too now concedes things are slowing down. Clearly plenty to think about for Prime Minister Matteo Renzi. For now though, he's sticking with his promise to step down should he lose the referendum on flagship reforms. They say don't change horses midstream His European colleagues perhaps wishing he would. SOUNDBITE (English) MIKE INGRAM, MARKET STRATEGIST, BGC PARTNERS, SAYING: "It's the third largest economy in the euro zone. If there are problems there, if there's populist backlash, that potentially is a euro killer." Britain and Brexit may be top of the agenda when EU leaders meet in Bratislava on Friday. Italy and its problems, though, won't be far behind.

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Is Italy the new sick man of Europe?

Thursday, September 15, 2016 - 01:30