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Italy turns corner on the 'darkness' of economic crisis

Letta says reforms will help increase GDP growth by next year

11 December, 10:38
Italy turns corner on the 'darkness' of economic crisis (ANSA) - Rome, December 11 - Italy will turn the corner on the "darkness" of the economic crisis with reforms to boost growth in 2014 and improve the country's institutions, Premier Enrico Letta said Wednesday. During a speech before a confidence vote in parliament on his 2014 agenda, Letta promised action to improve a despised election law, reductions in labour costs, and also pledged to cut debt that he said costs the country billions of euros in interest payments.

"2014 will be the first year with the plus sign, after the darkness of the crisis," said Letta, amid applause from supporters in his coalition government. "In 2014, we will complete the reform of social safety nets, in a climate of social dialogue," he said.

His policies should help the country achieve growth in gross domestic product (GDP) of 2% in 2015, added Letta.

He also noted that one of the country's biggest expenses is servicing the national debt, which has reached more than 130% of GDP and costs the Treasury as much as 90 billion euros in interest payments.

Although the European Union repeatedly calls on Italy to cut debt, Letta said the sheer costs of interest rates on that debt is the best argument for slashing it.

"Our national debt is colossal and we're attacking it...because it costs too much," he said.

Letta, in setting out his program for 2014, said plans to eliminate provinces, and election law reform are among changes to be achieved, building on the work he said his government began when it was appointed in April. "The great objective within the to have institutions that work and a democracy that is stronger and more solid," said Letta. He also referred to the turmoil his government has faced with its coalition partners, particularly ex-premier Silvio Berlusconi who tried to sink Letta's broad coalition with Berlusconi's now-defunct People of Freedom (PdL) party that ended two months of post-election stalemate in April.

The PdL ultimately split, with Berlusconi reforming his Forza Italia (FI) party that now sits in opposition, and other PdL members forming a New Centre Right (NCD) party to join Letta's Democratic Party (PD) in an altered coalition government.

Letta praised "the pragmatism of our government in the first six months, during which I worked with dedication despite ultimatum and threats...a government by the opposition between toxic enemies that switched to healthy collaboration between adversaries".