Time.news – “The Citizenship Income (RdC) regime, introduced in 2019, has contributed to reducing the level of poverty of the poorest sections of the population”. The OECD underlines this in the economic study on Italy, explaining that it is necessary “the number of beneficiaries who have actually found employment is scarce: the authorities attribute this result to the distance between the beneficiaries and the relative labor markets”.
For this, according to the OECD, it is necessary “reduce and thin the Citizenship Income to encourage beneficiaries to look for work in the formal economy and introduce a subsidy for low-income workers “.
On the macroeconomic front, “the estimates indicate a steady recovery of the Italian economy from the effects of the Covid-19 pandemic, with a consequent recovery of the activity levels of 2019 during the first half of 2022”. According to the OECD, greater public investments, including those generated by Next Generation Eu funds, will help to raise private investments in an extended form in 2022, which foresees “a recovery in consumption with the return to the workplace and less uncertainty that will encourage families to reduce precautionary savings “.
Furthermore, according to the OECD, “price pressures will increase in the short term due to rising commodity prices and in the construction sector; however, they will remain contained over the medium term. The manufacturing sector will benefit from the recovery in export demand in key markets, as well as from the positive effects deriving from the construction sector. “
According to the Organization, the risks to forward-looking estimates are “significant in both directions. The greatest uncertainty concerns the evolution of the virus and the pace of vaccinations in Italy and in the world. Other downside risks include a reversal in the confidence recovery trend, higher or faster failure rates, and deeper-than-expected scars from loss of business or employment skills. “
This would likely “worsen banks’ profitability and slow down lending, although systemic risk to the banking sector is lower than during the sovereign debt crisis period. Upside risks include a greater recovery in confidence, faster recourse to savings accumulated by households, faster-than-expected investment spending through Next Generation Eu funds and faster implementation of structural reforms “.
Italy’s GDP for 2021 will grow by 5.9%: the OECD has improved the previous estimates which predicted a growth of the gross domestic product to 4.5% in the current year. In 2022, Italy’s GDP is expected to grow by 4.1%. Previous estimates were + 4.4% next year.
.