IMF: challenge Italy sustainable growth and competitiveness. With recovery and low debt-to-GDP rates it will drop

2020-04-15T14:18:41.841Z

"Italy has been very affected by the epidemic and the government has responded strongly. In this context, the deficit rises to more than 8% and the debt is expected to rise to 155%" in 2020. Victor Gaspar says, head of the IMF Fiscal Monitor. "With the recovery of the economy in 2021, and with the ECB keeping interest rates low, debt is expected to fall - observes Gaspar -. Going forward the challenge for Italy is to be competitive, strengthen growth potential and achieve a inclusive and sustainable growth. Solving the debt problem in Italy is solving the problem of growth, which has been disappointing in the past three decades ". The Italian government's fiscal response to the crisis triggered by the coronavirus has been "strong" and "appropriate" and the International Monetary Fund "supports it". Said the head of the European Department of the Institute of Washington, Poul Thomsen, who did not however unbalance himself on the possible access to the Mes. "The decision whether to use the funds provided by the Mes is entirely up to the Italian political authorities," he observed. "All countries in Europe have the space needed to react strongly and appropriately to do what is needed to fight the pandemic. ". The measures to support the economy decided by governments to combat coronavirus will imply an increase in public deficits equal to 6% of GDP. The estimate was provided by the head of the European Department of the International Monetary Fund, Poul Thomsen, who called the answer "completely appropriate". Thomsen also urged European governments to use all the fiscal space they have available. "If not now, when?" "We strongly support the actions of the ECB. It is important that there is additional European support for national efforts" to combat the coronavirus "Higher deficits in Europe are appropriate," adds Thomsen. The International Monetary Fund "has not yet adopted a position" on coronabonds but considers it "important that there is a strong European response" to the crisis triggered by the coronavirus: "and we are seeing this". It is however crucial, he added, that "all countries, including those with high debts, can take the necessary actions without witnessing an increase in spreads". Global interventions against the crisis are worth 8 trillion dollars Eight thousand trillion dollars : the effort made by the states affected by the coronavirus pandemic to protect their citizens and to contain the economic impact of the blockade of productive and social activities amounts to a great deal. A crisis that is pushing the world into recession, with a 3% contraction in GDP in 2020 and an uncertain recovery in 2021. Provided that the epidemic disappears in the second half of the year. Most of the amount already allocated comes from the G20 countries, which have put 7 thousand billion on the plate. The International Monetary Fund, in the Fiscal monitor, accounts for the debt report, released on April 15. The efforts of governments are compounded by the 6 trillion dollars of liquidity injections by central banks, according to the calculations of the Global financial stability report. Healthcare costs, along with tax cuts and subsidies for businesses and families, according to the Fiscal monitor, have already amounted to 3,300 billion dollars. To these are added loans and injections of public capital for 1,800 billion dollars and guarantees for another 2,700 billion.