Virus-stricken Italy faces the worst recession since World War II | Instant News


Milan (AFP) – Facing the deepest recession since World War II and with business confidence crumbling, the coronavirus pandemic is hitting the Italian economy hard.

Business confidence in the eurozone’s third-largest economy in May dropped to its lowest level since the official statistical agency ISTAT started the index in March 2005.

That number is “alarming”, the Confesercenti’s small business federation said.

“Health and economic emergencies have swept businesses, especially in shops, services and tourism,” he said.

Its members are deeply concerned “by the lack of liquidity needed to pay fees and salaries … we can hardly return and that is why the actions decided by the government (loan guarantees, subsidized SMEs) must immediately operate,” federation chief Patrizia De Luise said.

“We need to reduce bureaucracy and speed up and simplify procedures, because if support is delayed again, many businesses have no choice but to stop,” he said.

The government last week accused the bank of not acting fast enough, but they said that they had submitted around 400,000 loan requests worth more than 18 billion euros ($ 20 billion) to the state-backed Central Guarantee Fund.

– one million jobs threatened –

Italy was the first European country to be hit by a pandemic and imposed a tight two-month lock that paralyzed much of the country’s economic activities.

As a result, the country was set for a decline in GDP of between nine and 13 percent, the Bank of Italy said on Friday.

Data also showed that the economy shrank 5.3 percent in the first quarter – worse than the initial estimate of 4.7 percent.

It did not see a “remarkable” decline in the first quarter since 1995, ISTAT said.

This year’s losses could reach 170 billion euros, equivalent to the GDP of Veneto, Italy’s third largest industrial region, a Mediobanca study said.

The head of the country’s main business confederation Cofindustria, Carlo Bonomi, said that up to one million jobs could be threatened nationally.

“We are waiting for figures at the end of May, but there are indications that between 700,000 and one million jobs are in danger,” he said.

“Jobs are only created if there is growth, innovation, investment. The car manufacturing crisis cannot be solved by subsidies or leave. You solve it by looking to the future, by investing in new technology,” he said.

Italy has been named as the main beneficiary of the European Union’s 750 billion euro recovery plan, but that is still not enough.

– There is no help –

Italians are a little more optimistic, but far from celebrating. The pandemic has killed more than 30,000 people.

Consumer confidence rose from 100.1 points in May to 94.3 in March, the lowest level since December 2013.

While the state has paid leave or leaflets for those who can no longer work, many have escaped the net.

They include Eleonora Fogliacco, 35, a fitness and swimming teacher in Lombardy, the hardest-hit region where the fitness center was ordered to close in late February.

“I am not eligible for a monthly government grant of 600 euros because I got more than 10,000 euros last year,” he told AFP.

“During the crisis, I experienced days of peace and days when I felt completely lost, without the help of the state. I could no longer see the future and I didn’t know what to hold on to,” he said.

“I don’t buy anything. I depend on my partner to shop,” Fogliacco said.

“This situation has changed the way everyone lives (and) everything will be very complicated” in the future, he added.

According to a Confcommercio-Censis poll published on Tuesday, 53 percent of Italian families see their future negatively and 68 percent see the country’s future negatively.

Because of the lockdown, 42 percent of families had to reduce their work and income, 26 percent stopped working and 24 percent had been employed.

Six out of 10 families are afraid of losing their jobs, as a result 28 percent decided not to take vacations or long weekends.



image source

to request modification Contact us at Here or [email protected]