Italian economy has ‘hit bottom’ – report

Italy's business association said on Thursday the eurozone's third largest economy had "hit bottom" and was on the slow path to growth, but sharply revised its gross domestic product forecast.

Italian economy has 'hit bottom' - report
Italy, Europe's third largest economy, should see a return to growth in 2014. Photo: Twid/Wikicommons

Confindustria said in a report that gross domestic product would shrink 1.9 percent in 2013, compared to a previous forecast of a 1.1 percent decline.

It said Italy would begin recovering in the last quarter of 2013 and see a return to growth in 2014, but warned progress would be "very slow" and cut the growth estimate for next year from 0.6 percent to 0.5 percent.

While it said indicators such as figures for car sales and family confidence suggest "we have hit bottom," Confindustria ratched up its 2013 debt to GDP ratio forecast from 126.4 percent to 131.7 percent and suggested it would rise to 132.4 percent in 2014.

There was glum news on the public deficit front as well, with the business lobby saying Italy's deficit would rise from 1.9 percent to 3.0 percent in 2013, hitting the European Union recommended ceiling.

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Italy expands €200 payment scheme and introduces public transport bonus

Italy's government will extend its proposed one-time €200 benefit to more people and introduce a €60 public transport payment, Italian media reported on Thursday.

Italy expands €200 payment scheme and introduces public transport bonus

Seasonal workers, domestic and cleaning staff, the self-employed, the unemployed and those on Italy’s ‘citizens’ income’ will be added to the categories of people in Italy eligible for a one-off €200 payment, ministers reportedly announced on Thursday evening.

The one-time bonus, announced earlier this week as part of a package of financial measures designed to offset the rising cost of living, was initially set to be for pensioners and workers on an income of less than €35,000 only.

However the government has now agreed to extend the payment to the additional groups following pressure from Italy’s labour, families, and regional affairs ministers and representatives of the Five Star Movement, according to news agency Ansa.

Pensioners and employees will reportedly receive the €200 benefit between June and July via a direct payment into their pension slip or pay packet.

For other groups, a special fund will be created at the Labour Ministry and the procedures for claiming and distributing payments detailed in an incoming decree, according to the Corriere della Sera news daily.

One new measure introduced at the cabinet meeting on Thursday is the introduction of a one-time €60 public transport bonus for students and workers earning below €35,000. The bonus is reportedly designed to encourage greater use of public transport and will take the form of an e-voucher that can be used when purchasing a bus, train or metro season pass.

Other provisions reportedly proposed in the energy and investment decree (decreto energia e investimenti), which is still being adjusted and amended, include extending energy bill discounts, cutting petrol excise duty and rolling on the deadline to claim Italy’s popular ‘superbonus 110’.

The €14 billion aid package, intended to lessen the economic impact of the war in Ukraine, will “fight the higher cost of living” and is “a temporary situation”, Prime Minister Mario Draghi has said.

The Local will report further details of the payment scheme once they become available following final approval of the decree.