If Italy wants to be considered reliable by international markets, it has to work to rebuild its image starting from some statistics that underline a stronger economy than the one often described, a noted economist said on Tuesday.
In an interview with Xinhua on the sidelines of a conference at the Milan Foreign Press Association, Marco Fortis, a professor of industrial economics at the Catholic University of Milan and a vice president of the Edison Foundation think tank, said that Italy is unfairly perceived as weak in terms of competitiveness and public debt.
In fact, the Italian industry is highly competitive, Fortis stressed. "Italy is one of the only five economies of the G20 with a structural trade surplus for the manufactured products,"he said based on the statistics compiled by the Edison Foundation on data from Eurostat and Italy's statistic agency Istat.
In 2012, Italy recorded the highest manufacturing net trade value of its history, or 94 billion euros (128 billion U.S. dollars), while estimates forecast a surplus of about 105-110 billion euros in 2013.
Fortis noted that the Italian gross domestic product (GDP) growth had been feeble in the last 20 years. This trend, however, was not originated from a lack in competitiveness but mainly depended on a process of deleveraging in public finances, with growing taxation, a reduction in household disposable income and consequent low increase of private consumption.
Furthermore, Italy did not participate to the world credit and housing boom of the beginning of the new century that boosted an unsustainable growth in many other countries.
"Though Italy's persisting political instability causes serious constraints for companies, the country's manufacturing sector remains the second in Europe and the fifth in the world in term of value added," Fortis noted.
According to the Trade Performance Index elaborated by Unctad-Wto, Italy is the second country after China for the highest number of non-food manufactured products, with a net trade value higher than of Germany's.
"Also, there are important foreign investments in Italy," Fortis added, especially in key sectors from mechanics to pharmaceutics, and the government has launched a program to reform a broad range of fields to further promote the country at the international level.
"It is true that 20 years ago Italy had one of highest public debts, not only in terms of GDP but also in absolute terms," Fortis said. But from the 1990s the Italian public debt to GDP ratio has declined considerably and during the world crisis it has increased less than in other advanced countries.
The statistics compiled by the Edison Foundation showed that Italy's cumulated primary balance in the last 17 years was the world's highest in modern history. Italy was one of the few countries in the advanced world that was capable to pay "cash" more than 40 percent of its interest.
Furthermore, public debt held by non residents was less than 35 percent of the total, differently from other countries where it is growing fast.
However, since a country's debt is conventionally placed in relation to the GDP, Italy's debt continues to appear much higher than that of other countries, the professor told Xinhua.
Therefore, why not look at the public debt in relation to the wealth of the families, since this is the only real underlying guarantee that makes an economy truly financially solid?
"Italy has one of the highest net financial wealths of the households in Europe and in the world," Fortis said. The country has the second public debt of the European Union (EU) in percentage of GDP, but only the 14th in percentage of households net financial assets.
Italy's recovery from the crisis, he highlighted, will be gradual "because it is necessary that the domestic demand has a little increase in the next two years." In his view, the country could post a 0.4-0.5 percent growth this year and, in the best case, have a recovery of one percent in 2015.
But what is most important, the professor added, was that Italy stops spreading "superficial self-damaging messages" and clarifies that many of the conventional economic indicators actually distort the real situation of the country. (1 euro = 1.37 U.S. dollars)./.