Italy's high public debt, the highest
in the eurozone after Greece's, creates vulnerability and
narrows room for maneuver if there are financial shocks, the
Bank of Italy said Monday.
"The decision to implement an expansionary budget, coupled with
a privatisation plan, implies that the ratio of public debt to
GDP will decrease only marginally over the next three years,"
said the deputy head of the Economy and Statistics Department of
the Bank of Italy, Andrea Brandolini, in a parliamentary hearing
on the 2024 budget.
"The high level of the ratio is an element of vulnerability for
the country; it reduces the room for manoeuvre to cope with any
adverse shocks and also raises the cost of debt for private
borrowers, with negative effects on the competitiveness of the
entire Italian economy".
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