Energy crisis: Italy risks 'thousands' of business closures, say industry groups

AFP/The Local
AFP/The Local - [email protected] • 11 Oct, 2022 Updated Tue 11 Oct 2022 13:06 CEST
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Protestors burn energy bills in Rome at a demonstration on October 3rd against the soaring cost of living. Energy price hikes will cause thousands of business closures in Italy unless the EU steps in with funding, said Italy's industry lobby on Monday. Photo by Alberto PIZZOLI / AFP

Italy needs some 50 billion euros to prevent thousands of companies failing and mass job losses due to soaring energy prices, industry groups said on Monday.


The head of Italian business association Confindustria appealed for an aid package to protect Italy's economy from surging energy costs, saying: "Without industry, there is no Italy."

"If we close thousands of companies, hundreds of thousands of jobs will be lost," the lobby's head Carlo Bonomi said in an interview with newspaper La Stampa.

READ ALSO: How much are energy prices rising in Italy this autumn?

"I am more concerned now than I was at the start of the pandemic," he said, adding that he estimated some "40 to 50 billion euros by 2023" was needed.


Surging energy prices mean Italian companies are expected to pay 110 billion euros more in 2022 than they did before the pandemic, of which 55.6 billion is due in the period September to December, the association said in a report.

Outgoing Prime Minister Mario Draghi's government has already spent 66 billion euros to help shield families and businesses from the energy crisis, financed by higher-than-expected tax revenues.

Bernabò Bocca, the head of Italian hoteliers' association Federalberghi, said on Tuesday the effects of soaring energy prices are as devastating for the tourism industry as the Covid-19 pandemic was at its peak, and called for the EU to intervene.

"A major intervention on high energy prices is needed from Europe at once or many hotels and tourism businesses will close," Bocca told the Ansa news agency.

They did the Recovery Fund for the pandemic and this is a new Covid for tourism," he said, saying the industry needed "money, not tax credits".

Bonomi told La Stampa: “If the EU does not give us the necessary help, deviation [from the budget] will become inevitable "

Giorgia Meloni, who is set to lead Italy's incoming government after her party won last month's election, said she will "have to resort to other resources... if (she) cannot count on European solidarity to reduce the energy bill".

Giorgia Meloni visits an event organised by the Italian Farmers' Association. Expected to become Italy’s new prime minister, Meloni says she’ll put ‘Italy first’ when handling the energy crisis. Photo by Piero CRUCIATTI / AFP

Meloni said she would “put Italy first” in dealing with the energy prices after Germany this week announced it would spend up to 200 billion euros helping consumers and businesses cope with surging energy prices - while refusing to back the European price cap on gas supported by Italy and other countries.

Meloni previously said she was reluctant to consider deepening Italy's vast existing debt - which already stands at some 150 percent of GDP.


Economic output is expected to decline slightly in the second half of the year, a downturn which could continue into the first quarter of 2023, according to a government forecast - plunging the country into recession.

That would reduce tax revenues and limit the new government's room for manoeuvre.

Meanwhile, the new government will be made up of a coalition of parties which campaigned on promises to slash taxes for businesses and consumers.



AFP/The Local 2022/10/11 13:06

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