Italy Fears Economic Contraction Due to Coronavirus

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The Italian economy is in danger of shrinking due to the outbreak of the new coronavirus, warned State Secretary of Finance Antonio Misiani on Thursday.

 

China is considered an important trading partner in Italy. China, for example, is the third supplier, the state secretary emphasised.

The Chinese also have an essential share in Italian tourism and they buy a significant part of the luxury products that Italy makes.

The European Commission already adjusted the forecasts for Italian economic growth on Thursday. The forecast for this year went from 0.4 percent to 0.3 percent growth.

Misiani also pointed to some bright spots. For example, there is more demand for Italian government bonds, and consumer confidence increased in January.

The Italian government wants to boost the economy through, among other things, a reform of the tax system. Rome also intends to help Italian companies with significant exposure to the Chinese market.

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