Italy GDP up 0.9% in 2016 and 2017-EC (3)

(ANSA) - Brussels, February 13 - 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%.