The European Commission said
Monday that Italy's GDP rose by 0.9% in 2016, higher than its
forecast of 0.7%.
It also said in its winter forecasts that it expects the
Italian economy to grow by 0.9% again this year and by 1.1%
next, having previously forecast a GDP rise of 1% for 2018.
It described Italy's growth as "stable by modest" as
"structural weaknesses hamper a stronger recovery".
Italy's economic outlook is threatened by "political
uncertainly" related to the possibility of early elections and
the "slow adjustment" of the country's troubled bank sector, the
European Commission said.
It also said that "a strong impulse may yet come from
external demand".
The European Commission welcomed, on the other hand, Italy's
commitment to meet its request for an adjustment to reduce its
structural deficit.
"The Commission takes positive note of the government's
public commitment to adopt additional fiscal measures worth
overall 0.2% of GDP by April 2017," the Commission said in its
winter economic forecasts.
"These will be taken into account as soon as sufficient
details are available to assess the specific provisions to be
enacted".
The European Commission said that Italy's deficit-to-GDP and
debt-to-GDP ratios are set to remain "broadly stable".
It said the deficit-to-GDP for 2016 was 2.3%, revised down
from its autumn forecast of 2.4%, and will stay at 2.4% for
2017.
It also revised down slightly the debt data for 2016, from
133% of GDP to 132.8%, while it revised up its forecasts for
2017 to 133.3% from 133.1%.
Unemployment in Italy "remains high" and the phasing out of
incentives for new hires is expected to lead to a deceleration
in employment growth,it added.
The Commission revised up its forecast unemployment for 2016,
from 11.5% to 11.7%, for 2017, from 11.4% to 11.6%, and for
2018, to 11.3% from 11.4%.
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