Italy economy resilient but risk of GDP fall - IMF

The Italian economy is resilient but there is a risk of GDP falling, the International Monetary Fund said Wednesday, Azernews reports, citing ANSA.

In a report also hailing the government's pledge to bring down debt, the IMF said the Italian economy has navigated the effects of the war in Ukraine well, proving to be "resilient" to shocks.

After growing by 3.7% in 2022, growth is expected to enter a slower phase with "mainly downside risks" to growth, which the IMF on Tuesday put at 1.1% in 2023 and 0.9% in 2024. However, the Fund emphasises that "the overall risk of stress on Italy's sovereign debt is moderate" The IMF went on to highlight the importance of decisively reducing public debt and applauded the Italian authorities' commitment in this regard, the fund said at the end of the Article IV consultations, emphasising that the short-term adjustments decided upon are adequate.

"In the medium to long term, a strong primary surplus is needed to support a decisive debt reduction," the Fund noted, pointing out that the consolidation will have to be supported by "efficient and well-defined measures".

Italy's debt-to-GDP ratio was 143.5% in the January-March 2023 period, down from 144.4% in the previous quarter, Eurostat said on Friday.

Italy has the second highest debt in the eurozone after Greece.