900 Italy in recession

AND? ? ? :confused:

There you go George -

MILAN : The Italian economy has slipped unexpectedly into recession with the worst quarterly performance for six years, in contrast with a rebound in Germany, putting pressure on Prime Minister Silvio Berlusconi a year before general elections.

The national statistics institute Istat said in an initial estimate on Thursday that gross domestic product in the first quarter of this year fell by 0.5 percent from the figure for the previous quarter, and 0.2 percent on a 12-month basis.

The first-quarter GDP contraction was the second in a row, meeting the technical definition of recession. In the last quarter of last year, GDP fell 0.4 percent.

The quarterly economic performance was much worse than expected. Analysts polled by Italian agency Radiocor had forecast growth, at a slight 0.2 percent quarter-on-quarter and 0.5 percent compared with the 2004 first quarter.

The quarter's 0.5-percent annual decline was the worst showing since the 1998 fourth quarter, when GDP also fell 0.5 percent.

Italy had not had two successive quarterly contractions since the first half of 2003, but the decline was about half as strong, at 0.2 percent.

"Considering the size of the decline posted over these last two quarters, there is no doubt that we are in recession," said Fedele De Novellis, an analyst at the Ref institute.

Berlusconi downplayed the data, blaming the first-quarter fall on an early Easter and people going on holiday.

"In March, there were the Easter holidays. You can't go to the sea and expect GDP to grow," Berlusconi told reporters.

In comments at a conference, Berlusconi said the government planned, at its weekly meeting Friday, to agree on cuts of four billion euros in the IRAP regional tax on companies per year over three years.

"The official announcement will be tomorrow, after the ministers meeting, but I am making the announcement now," he said.

"Yesterday evening, we defined with the economy minister (Domenico Siniscalco) the plan," he said.

Berlusconi won Senate approval Thursday for broad legislation aimed at kick-starting the economy and improving competitivity. The measure had been approved late Thursday by the lower house.

But the latest GDP data represented another blow for the prime minister and his Forza Italia party ahead of the May 2006 general elections, following recent opposition victories in regional elections.

Meanwhile, Germany, the eurozone's biggest economy, posted Thursday a surprise 1.0 percent rise in GDP in the first quarter, its best performance since early 2001.

"The contrast is striking with the rebound posted in Germany and Italy could become the weakenst of the major economies in the eurozone," said Carmen Nuzzo, an analyst at Citigroup.

An analyst at Banca Intesa, Gianluigi Mandruzzato, called the two quarterly Italian contractions "very negative and worrying". Exports probably had weighed on growth due to Asian competition, he said.

Industrial production data for March also published Thursday by Istat showed steep declines in sectors particularly vulnerable to competition from Asian countries.

Industrial production in March fell an unadjusted 0.6 percent from the previous month, Istat said, after having held steady in February according to seasonally adjusted data.

Radiocor-polled analysts had forecast only a 0.1 percent dip.

On a 12-month basis, industrial output plunged 5.2 percent.

The worst-hit sectors were the "Made in Italy" products that are facing stiff Asian competition, such as textiles, down 3.6 percent on the month and 11 percent on the year, and leather goods and shoes, off 7.1 percent on the month and 16.6 percent on the year. - AFP/de

SORRY, the AND was to the original poster, I thought the forum was to discuss things, not just post a link then lurk, I mean, if you have an opinion voice it, and, where's the surprise, most Europeans want to knock Italy's economy anyway, it saves them from looking at their own, errrrm, I'm going to start putting lots of dots down in a minute ;)

I fully agree GeorgeS.

Rather than simply regurgitate a list of newspaper reports and national statistics it would be good to provide some incisive debate on this subject.

And I thought I was being helpful pasting the link - last time I'll do that!! - but at least we know what we might discuss and express opinions about. My opinion 'no suprise' - Berlusconi's remark about GDP not growing because everyones gone the beach, priceless. The numbers, textiles down 11% and leathergoods down 17%, on the year, very serious. The great and good of the Milano fashion houses will not be happy.

I can't see any signs of a recession in Northern Abruzzo, quite the opposite. The construction industry is booming, it's impossible to find industrial premises and there's rapid development of new industrial estates from the border with Marche down to Pescara. Last time I was in Lanciano it looked busy there too.

House building is also booming and I'm glad that I own enough land as a buffer between me and being encroached on by new developments. Farmers seem to be doing OK, all my neighbours have invested heavily in new equipment and with the average tractor costing more than a Rolls Royce car there's no obvious shortage of cash there either. Over the past few years the number of tatty old Pandas seen around the village has declined and there are more Porsche Cayennes, Volvos, Mercedes and BMWs than other car marques put together. They are not the property of rich visitors either, most owned by locals. The Land Rover dealer in Pineto seems to be rubbing his hands with glee every time I see him.

There is nothing wrong with your original posting of the link. We all know how to click on a link, there is really no need for you to paste it for us; you were very kind to do so. Your intention was to start a discussion, I am sure, and you have succeeded. Thanks!

no issues with the link posted but its a bit of an old story :) for which we have several stories on the website

[url]http://www.italymag.co.uk/2005/frontpage/current-affairs/italys-economic-crisis-is-homemade-says-montezemolo/[/url]

[QUOTE=lotaresco]I can't see any signs of a recession in Northern Abruzzo, quite the opposite. The construction industry is booming, it's impossible to find industrial premises and there's rapid development of new industrial estates from the border with Marche down to Pescara. Last time I was in Lanciano it looked busy there too.

House building is also booming and I'm glad that I own enough land as a buffer between me and being encroached on by new developments. Farmers seem to be doing OK, all my neighbours have invested heavily in new equipment and with the average tractor costing more than a Rolls Royce car there's no obvious shortage of cash there either. Over the past few years the number of tatty old Pandas seen around the village has declined and there are more Porsche Cayennes, Volvos, Mercedes and BMWs than other car marques put together. They are not the property of rich visitors either, most owned by locals. The Land Rover dealer in Pineto seems to be rubbing his hands with glee every time I see him.[/QUOTE]

you make some valid points, but its the industrial north that carries the major
economy for italy.
as for housing booms, well its quite some years now since people started
moving out of the older building to newer ones in their droves,so i wouldn't
make any findings based on this either.
if you were to do this then the campania/molise area is on fire...

Come on boys and girls - we posted all the info so that you did'nt have to go to the link, and very bleak it looks - so whats the score.

Lotaresco thinks that everything is rosy outside of his/her front door, everyone driving BMW/Mercedes, and building new houses, and enough land to weather the storm, shame about the rest of us . the economic fraternity in Europe would seriously disagree with him?????. Come on! Comments please.

[QUOTE=Ian and Sandra]... Come on! Comments please.[/QUOTE]

Careful now with your wording, next thing, somebody will claim that your are demanding a response.

SO, where do you two get off.......... demanding responses like that........... I think it's an absolute disgrace..........etc., etc., Naaahhh, cant keep it up, how are you? Have you been down to the Tall Ships today ? lovely day here in Francavilla, cool start for a change, not sure about the economy, but, the sun shines, the fruit grows and my neighbour started playing in the fields with his tractor at 4.30 am, mind you, it was his old tractor, so there might be something in this economic depression thingy, unless he's keeping his new one clean for the agricultural show next weekend... car show here on Saturday evening if you're passing...

It may be an economic paradox, but it seems that despite the fact that some observers will argue that the Italian economy is technically in recession, there are signs, according to the Osservatorio dell’Economia Italiana for example, that some of the uncertainty among entrepreneurs is starting to recede. If you go by the results of a recent survey of 4000 Italian companies, it would appear that there is a more positive outlook for orders and production in the short-term.

Another interesting observation comes from the result a recent Istat examination of local work practices. Apparently there is a renewed dynamism and growth especially in the manufacturing sector in the Mezzogiorno, with parts of Campania and Puglia being cited as regions with the most positive change in economic regeneration. Other areas apparently showing this increased dynamism are southern Lazio and Abruzzo, although this phenomenon seems to prevail in Tuscany and the Marche where the proportion of small business in relation to local manufactories is 79.2% and 53.3% respectively.

In addition to the above, the property market, according to Gualtiero Tamburini, president of Assoimmobiliare, also seems to be making a positive contribution by adding value and wealth to Italy’s economy. The real estate sector with sales of around 36 billion euro now employs around 330,000 people compared to 85,000 in 1991.

How far statistics or reports such as these can be trusted need not be considered here; they are plain in the sources provided. But given the current underlying feelings, what Lottaresco is alluding to, in the simplest of forms, is perhaps testimony that the praxis of renewed confidence and optimism is confined to very small parts of the country. Whereas this might provide a useful insight into what is happening at the local level, this is not, I believe, truly representative of the wider economic picture and, given Italy’s well-reported model of tax evasion and its complex, albeit obscured structure of income and expenditure, it would be incorrect to conclude that all is well without knowing what is really happening at the national level. To draw such inferences would in my opinion run the risk of prolonging the inevitable illusion that Italy (or certain parts of Italy) is basking in the sunshine of an “economic Indian summer.”

Some interesting times ahead!

It takes me back to when I was working in Milan (1987). An English journal, I can't recall which it was, had two articles side by side. One described an economic basket case. The other described a thriving economy. At the foot of the page it explained that both countries were one country, Italy.