Draft DEF puts 2022 GDP growth at 3.1%, deficit 5.6%
Growth forecast down from 4.7%, deficit target confirmed
Redazione Ansa
(ANSA) - ROME, APR 6 -
A draft of the government's DEF economic and financial blueprint puts 2022 GDP growth at 3.1%, down from 4.7% in a previous estimate, and confirms a budget deficit of 5.6%, according to a copy of the document which ANSA has seen. GDP will contract by 0.5% in the first quarter of this year, the draft DEF said, and there is a "risk of a downward trend continuing" in the second quarter too. It said the fall was largely due to a reduction in industrial growth. The DEF was examined by the cabinet Wednesday afternoon after first being assessed by the government's 'control room' advisory body. The Def draft also said there was 0.5% room for maneuver in the deficit amounting to over nine billion euros, and said some five billion would be used for fresh aid to the economy. The document said public debt in 2021 had been revised upwards to 150.8% and would fall to 146.8% in 2022, to then continue to fall to 141.2% in 2025. The tax burden will be 43.1% of GDP in 2022, the draft DEF said, down from 43.5% in 2021. The adjusted and "effective" tax burden will fall this year from 41.7 percentage points to 41.2 points, it said. A fresh decree with aid to the economy will be hammered out by the end of April, sources said, with an impact of 0.2 percentage points of GDP in 2022 and 0.2 in 2023. As a first step, it will restore 4.5 billion euros used in a decree to cap power bills, the draft said. A further five billion will be earmarked for four moves: curbing fuel and energy prices, boosting funds to cover an increase in prices of public works, increasing funds for credit guarantees, and other measures to help Ukrainian refugees and cushion the impact of the conflict on Italian businesses, the draft said. The DEF also sets out spending targets for national labour contract renewals in the civil service and public administration, as well as funding for Italy's international missions. If Russia were to halt the export of its gas to Italy, the DEF draft says, it would bring down GDP by 0.8 percentage points this year. The DEF forms the basis for the government's economic policy and budget for the coming year. At the control room meeting with Premier Mario Draghi, ministers and majority leaders, Economy Minister Daniele Franco said there had been "a marked diminution in growth expectations due to uncertainty linked largely to the ongoing Ukraine conflict". He said it was a priority to approve the DEF as quickly as possible with a new aid decree, after which more support for the economy may well come. The Def was unanimously approved by cabinet Wednesday evening. photo: Economy Minister Franco