International Monetary Fund, a positive assessment on Italy
In spite of all the current challenges, Italian recovery as been praised as “impressive”
Modest but encouraging impressions come from the International Monetary Fund (IMF) with regard to Italy. After praising Matteo Renzi's government reform process - defined as "impressive" the world institution's forecast on Italian GDP growth has gone up to 1.1%.
At the same time, the Fund puts a spotlight on the banking system and the credit institutions. The situation in this field has been undermined by the "non performing loans" and the multiple on-going judicial actions. For these reasons, the IMF asks for a better control on banks and retail investors to assure a greater stability.
The Fund has also advised Italian government to implement further structural reforms and fiscal one, along with a huge intervention on pensions. Of course, the IMF seemed well aware of the costs of all the suggested reforms, which may require hard social choices, such as cutting down social expenses and introduce a new tax on houses.
Keeping this rhythm, the IMF has hypothesized that Italian conditions could go back to how they were before the crisis in 2020. Meanwhile, it seems crucial to keep an eye on the national balance sheet in order to make it less vulnerable.
In particular, besides national challenges (such as unemployment, social security, fiscal pressure), national economy should be protected by a number of international matters of concern. Among them, the migrant crisis has a relevant impact on Italy together with the so called "Brexit Risk". The latter concerned the probable exit of Great Britain from the European Union and all the connected consequences for its political an economic partners.
According to the emissaries sent by IMF Managing Director Christine Lagarde "it seems quite hard to see Italian public debt decreasing by this year, but it has definitely taken a descending trend" the government can be proud of, in spite of the numerous obstacles.