Italy, Debt/GDP ratio down to 284%. How much further can it go down?
The post-Covid virtuous dynamic continued in 2023, thanks mainly to households and businesses. But with the trend reversal in the last quarter, a new alarm bell is ringing
2' min read
2' min read
Italy's debt is growing again in 2023, after at least a couple of years of virtuous dynamics following the painful but necessary excesses to cure the effects of Covid. In this respect, our country is certainly not moving away from the global trend highlighted in the Global debt monitor published by the Institute of international finance (Iif), although it continues to maintain some of its peculiarities.
Total data
.The total value has increased by the equivalent of around $384 billion to a share of $6.380 billion, which is not a record for the Peninsula as it is on a global scale, but is nevertheless higher than the pre-pandemic level. It is, however, the 'grasshopper' State that carries the greatest weight, while families and businesses are playing the role of 'ants'. In the last 12 months, public debt has in fact grown by a further 221.7 billion dollars, followed by that of financial companies +99.6 billion), while the contribution of families (+24.5 billion) and productive enterprises (+38 billion) has been more marginal.
The relationship with GDP
.When comparisons are made with nominal GDP, which for its part also benefited from the inflation effect, the national debt, on the other hand, contracted in 2023 from 288.7% to 284%, completely in line with the rest of the world. Here too, however, the disparity between the state (worth almost half at 133.9%) on the one hand and businesses (64.2%), banks (the only ones to grow from 46.1% to 47.1%) and households (just 38.9%) on the other is striking. Change of directionHowever, it should be noted that the last quarter, if isolated from the rest of last year, showed a reversal of trend even in this area, with the overall debt/GDP again on the rise compared to that 282.3% at the end of September, which represented the lowest for a good 16 years. This is a sign that should not be underestimated for a country that is facing a period of growth that is still below potential and is unlikely to be able to count on the favourable effect exerted (at least on debt) by the sustained inflation seen in the last two years.
