Economic recovery sluggish - Visco (2)

(ANSA) - Rome, October 27 - Italy's economic recovery hasn't stopped but is progressing sluggishly, although it should see a slight uptick in the third quarter, said Bank of Italy Governor Ignazio Visco on Thursday. "Despite improvements from reforms, the production system is still hampered by a climate unfavorable to business, still weighed down by excessive bureaucracy, the slow pace of the justice system, and illegal activity," he said.
    He said Italy's high public debt leaves little room for government intervention to support economic activity, in the context of the tension between the Italian government and the EU over Italy's 2017 budget plan.
    He called observations on the seriousness of the Italian banking crisis "exaggerated", citing recent Bank of Italy analyses and adding that for banks in difficulty, there are "specific actions" underway.
    He also addressed job cuts in the banking sector. The current plan to save the troubled Monte dei Paschi di Siena bank features the shedding of 2,600 jobs and the closure of 500 branches. Visco said that in some cases intervention on personnel costs can "assume an important dimension". "To contain social consequences, existing social safety nets will be utilised, (as well as) the resources of the sector's solidarity fund, whose use was recently extended, and (resources) that will made available with upcoming legislative actions".
    Visco was speaking on the occasion of the 92nd World Savings Day, organised in Rome by the Italian Association of Savings Banks and Foundations (ACRI).