Notwithstanding nearly draconian tax measures that should have seen the stabilization of the economy and a reduced debt load, the Italian economy has failed to respond to Monti's austerity program.
Italians in general have had to shoulder the burden of the program through an intensive tax program that saw both new taxes imposed and the reinstatement of old ones, such as property taxes, that had been abolished by the Berlusconi government.
The financial news that the Italian economy has shrunk more than previously projected has sent some alarm bells in the European community. These news only worsen an already worrisome picture for the country, which has the third largest economy in the Euro zone.
Some other news, some contend, are simultaneously showing a "positive change" citing indices of leading indicators.
The Italian government insists that although the economy will shrink by 1.3 this year, next year it will see growth by 1.3%. However, even if that growth materializes, it might fall woefully short of what is needed to stabilize the country's economy.
The figures right now are pretty bleak: demand fell on all the indicators goods, fixed investment fell by 3.3% and exports by 1.9%. The latter figure is significant, since the austerity program should not have had a negative impact on export figures.
Source : France 24/ 6.10.13
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