Giorgia Meloni, the EU parliament in the background
Italian debt, the choice not to use the ESM and the consequences on public finances
The Italian public debt now it’s really out of control, it weighs significantly on the Super bonus. To certify the deep red of Italy is a new report which highlights how very soon (within three years), Italy it will even surpass Greece and it will become the worst in Europe. The figure calculated by Scope Rating on the Italian public accounts which will be released today – reports Il Sole 24 Ore – is imposing. And it is no coincidence that it travels on the same orders of magnitude as the spending of the Superbonus, i.e. the main driver of the debt for this and the next few years. The scenario on which the rating agency’s analyzes are based (which gives a BBB+ rating with a stable outlook to Italian government bonds) it is not in itself dramatic, because it is based on a forecast of average annual growth of 1% and inflation around the ECB target of 2% over the next five years. But Complicating it are precisely the effects of tax credits to construction, intended for push the debt up by 2 points of GDP per year until 2027and then reduce its momentum in the following period.
To reduce the burden of debt on GDP by one percentage point per year from 2027 as required by the new European fiscal rules – continues Il Sole – Italy must start the brake from next yearAnd accumulate between 2025 and 2029 an improvement in the primary balance of 135 billion euros: sum worth 5.8% of the national gross domestic product. The international comparison shows that the downward path of the debt, albeit at a less intense pace, is also taken by the other countries assisted by the ESM such as Spain (Scope predicts 9.5 points less debt/GDP between 2023 and 2028) and Portugal (15.8 points in the same period). In a horizon of this type, the task of finding the 18.2 billion needed to replicate this year’s fiscal measures in 2025, far from the extradeficit, is only the first step on a very narrow ridge.
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