Italian government debt

Source: Wikipedia, the free encyclopedia.

The Italian government debt is the

national wealth is four times larger than its public debt.[2]

Composition

The Italian public debit is in 2017 owned by the private sector only for the 6% of the total amount. This percentage decreased significantly from 1988, where this share was 57%.[3]

Main holders of Italian public debt in June 2019 (Bank of Italy statistics) are: households= 4.4%, Italian banks= 30.6% (which includes a 12.8% share of public debt made of bank loans to local administrations), Italian insurance companies= 13.7%, investment funds (with mainly Italian beneficiaries)= 13.2%, foreign (banks, insurance, etc.)= 20%, Eurosystem (Bank of Italy through liabilities owed to European Central Bank, and paying interest to the Italian treasury)= 17.7%. The total share of Italian public debt detained by foreign holders, including the European Central Bank, is 45%.[4]

History and government action

debt to GDP ratio
of selected countries, 2010. Italy is displayed in purple.

2010

Italy ran a budget deficit of 4.6% of

$2.4 trillion in 2010).[5] This led investors to view Italian debt bonds as a risky asset.[6]

2011

On 15 July and 14 September 2011, Italy's government passed austerity measures meant to save €124 billion.[7][8] On 8 November 2011 the Italian bond yield was 6.74% for 10-year bonds, climbing above the 7% level where the country is thought to lose access to financial markets.[9]

On 11 November 2011, Italian 10-year borrowing costs fell sharply from 7.5% to 6.7% after Italian legislature approved further austerity measures and the formation of an emergency government to replace that of Prime Minister Silvio Berlusconi.[10]

The measures include a pledge to raise €15 billion from real-estate sales over the next three years, a two-year increase in the retirement age to 67 by 2026, opening up closed professions within 12 months and a gradual reduction in government ownership of local services.[6] The interim government expected to put the new laws into practice was led by former European Union Competition Commissioner Mario Monti.[6]

2012

Government debt reached 127.0% of GDP in 2012.[11]

2013

Government debt reached 130.4% of GDP in 2013.[11]

2014

Government debt reached 131.1% of GDP in 2014.[12]

The Italian government has sought to privatise government assets in 2014 in order to reduce debt, including a sale of the Italian government's minority stake of Poste Italiane stock.[1]

In January 2014 the Italian government also agreed to offer citizens a chance to use a new voluntary disclosure scheme to repatriate assets held abroad, often in Swiss banks.

Bank of Italy estimated that Italians held €180 billion in undeclared assets abroad, a figure that was three times as high as in 2004.[1]

See also

Europe:

  • Eurozone crisis

References

  1. ^ a b c d e Emsden, Christopher; Zampano, Giada (January 24, 2014). "Italy's Letta Says Poste Sale Will Help Cut Public Debt". The Wall Street Journal.
  2. ^ Claudio Celio (15 November 2014). "Italy has lowest share of public debt held by non-residents". Il Sole-24 Ore.
  3. ^ "Chi detiene il debito pubblico italiano: 30 anni di cambiamenti". Repubblica. 29 May 2018. Archived from the original on 29 May 2018.
  4. ^ "Who holds Italian government debt?". CEPS. 24 Jun 2019. Archived from the original on 31 Jan 2023.
  5. ^ "CIA Factbook-Italy". Central Intelligence Agency. Retrieved 2012-05-14.
  6. ^ a b c Migliaccio, Alessandra (11 November 2011). "Italy Senate Vote Makes Way for Government Led by Monti". Bloomberg. Retrieved 11 November 2011.
  7. ^ "EU austerity drive country by country". BBC. 22 September 2011. Retrieved 9 November 2011.
  8. ^ "Italy parliament gives final approval to austerity plan". Reuters. 14 September 2011. Retrieved 9 November 2011.
  9. ^ "Berlusconi to resign after parliamentary setback". Reuters. 8 November 2011. Retrieved 9 November 2011.
  10. ^ Moody, Barry (11 November 2011). "Italy pushes through austerity, US applies pressure". Reuters. Retrieved 11 November 2011.
  11. ^ a b N.A. (16 September 2013). "Italy to hike 2014 debt forecast to 132.2 pct of GDP - draft". Reuters.
  12. ^ "Conti Nazionali". www.istat.it (in Italian). ISTAT. Retrieved 22 December 2015.