ROME — The Italian government is set to ask Brussels for flexibility in its budget rules as the country battles the coronavirus outbreak.
On Monday, Antonio Misiani, a deputy finance minister, announced that the government will later this week ask parliament to approve €3.6 billion in extra borrowing to tackle the health emergency.
That would increase the countrys deficit for this year by 0.2 percent to 2.4 percent. While thats still some way off the EUs 3 percent deficit ceiling, according to two government officials in Rome its far too early to know if the extra cash will be enough to counter the negative effects on the economy caused by the outbreak.
As of Monday, more than 1,800 people had tested positive for the virus in Italy, with around 10 percent of those in a critical condition. The death toll has surpassed 50.
Members of the opposition, including former Prime Minister Silvio Berlusconi and ex-Interior Minister Matteo Salvini, are clear that they believe the government hasnt done nearly enough.
The tourism industry lobby Confturismo said it expects the virus to cause a €3 billion hit across the next quarter.
“We need a Marshall Plan, the EU must suspend budget rules,” Berlusconi said Sunday. Salvini said €3.6 billion was peanuts and Italy will need at least €20 billion to tackle the emergency.
According to the two officials in Rome and another in Brussels, there have been informal conversations between Italys Finance Minister Roberto Gualtieri and the EUs Economy Commissioner Paolo Gentiloni (a former Italian PM), and Brussels will not oppose the request for flexibility.
If that does happen, it will be welcome news for Italian officials already worried about the economy. In a report out Monday, the Organization for Economic Cooperation and Development (OECD) revised down to zero Italys growth forecast for this year. The OECD also warned that coronavirus will cut world economic growth this year and could push the eurozone into recession if the epidemic becomes worse than projected.
Italy has been hit harder by coronavirus than any other European country. Under an emergency decree approved by Prime Minister Giuseppe Conte on Sunday night, schools in the northern regions of Lombardy and Veneto will remain closed until at least March 9; the areas at the center of the outbreak continue to be in lockdown; major sporting events have been suspended; and shopping malls, gyms and other public buildings are closed.
The Duomo reopens, for the first time since the coronavirus crisis in the Italian Lombardia northen region | Miguel Medina/AFP via Getty Images
Many factories in the north of the country are also closed and several are reporting cancellations of international orders linked to coronavirus fears. Public health authorities are also advising people to stay at least 1 meter away from others, which has been cited as a reason why restaurants, pubs and cinemas across the country have seen a massive drop in takings.
ROME — The Italian government is set to ask Brussels for flexibility in its budget rules as the country battles the coronavirus outbreak.
On Monday, Antonio Misiani, a deputy finance minister, announced that the government will later this week ask parliament to approve €3.6 billion in extra borrowing to tackle the health emergency.
That would increase the countrys deficit for this year by 0.2 percent to 2.4 percent. While thats still some way off the EUs 3 percent deficit ceiling, according to two government officials in Rome its far too early to know if the extra cash will be enough to counter the negative effects on the economy caused by the outbreak.
As of Monday, more than 1,800 people had tested positive for the virus in Italy, with around 10 percent of those in a critical condition. The death toll has surpassed 50.
Members of the opposition, including former Prime Minister Silvio Berlusconi and ex-Interior Minister Matteo Salvini, are clear that they believe the government hasnt done nearly enough.
The tourism industry lobby Confturismo said it expects the virus to cause a €3 billion hit across the next quarter.
“We need a Marshall Plan, the EU must suspend budget rules,” Berlusconi said Sunday. Salvini said €3.6 billion was peanuts and Italy will need at least €20 billion to tackle the emergency.
According to the two officials in Rome and another in Brussels, there have been informal conversations between Italys Finance Minister Roberto Gualtieri and the EUs Economy Commissioner Paolo Gentiloni (a former Italian PM), and Brussels will not oppose the request for flexibility.
If that does happen, it will be welcome news for Italian officials already worried about the economy. In a report out Monday, the Organization for Economic Cooperation and Development (OECD) revised down to zero Italys growth forecast for this year. The OECD also warned that coronavirus will cut world economic growth this year and could push the eurozone into recession if the epidemic becomes worse than projected.
Italy has been hit harder by coronavirus than any other European country. Under an emergency decree approved by Prime Minister Giuseppe Conte on Sunday night, schools in the northern regions of Lombardy and Veneto will remain closed until at least March 9; the areas at the center of the outbreak continue to be in lockdown; major sporting events have been suspended; and shopping malls, gyms and other public buildings are closed.
The Duomo reopens, for the first time since the coronavirus crisis in the Italian Lombardia northen region | Miguel Medina/AFP via Getty Images
Many factories in the north of the country are also closed and several are reporting cancellations of international orders linked to coronavirus fears. Public health authorities are also advising people to stay at least 1 meter away from others, which has been cited as a reason why restaurants, pubs and cinemas across the country have seen a massive drop in takings.
