(MENAFNEditorial)
Core Views
* Italy will return to modest growth in 2014 and 2015 although a weak labour market and ongoing contraction in credit growth will continue to impede a more robust recovery.
* We view positively the urgent structural reform agenda of new Prime Minister Matteo Renzi. However we remain sceptical that he will be able to avoid the chronic instability political infighting and rigid vested interests that that have in the past impeded reform efforts.
* Lack of significant structural reform in previous years seriously jeopardises Italy's long-term growth trajectory and raises the risks that the public sector debt burden will become unsustainable.
* Even if reforms aimed at addressing Italy's decline in productivity growth and external competitiveness are passed an ageing demographic profile will make debt consolidation efforts over the long term exceedingly difficult.
Full Report Details at
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Major Forecast Changes
* No major forecast changes
Key Risks To Outlook
* If Renzi's reform programme succeeds at rapidly pushing through key reforms in 2014 and 2015 we see upside risks to our growth forecasts over the medium and long term. Although these structural reforms would likely take several years before their full effect on the real economy is felt immediate positive benefits could come in the form of rising investor and business confidence lowering credit spreads and encouraging domestic firms to expand and invest.
* The Italian banking sector remains a key downside risk ahead of the European Central Bank's Asset Quality Review. Any major capital shortfalls uncovered could reignite the negative feedback loop between sovereign and banking sector risk leading to another rapid loss of investor confidence in Italian assets. This would significant impede the government efforts to push through reform while staying within the European Union's budget deficit limits.
The Italy Country Risk Report helps businesses with market assessment strategic planning and decision making to promote growth and profitability in Italy. It is an essential tool for CEOs Chairmen Finance Directors/CFOs Managing Directors Marketing/Sales Directors with commercial interests in this emerging market.
An influential new analysis of Italy's economic political and financial prospects through end-2019 just published by award-winning forecasters Business Monitor International (BMI).
Key Uses
* Forecast the pace and stability of Italy's economic and industry growth through end-2019.
* Identify and evaluate adverse political and economic trends to facilitate risk mitigation.
* Assess the critical shortcomings of the operating environment that pose hidden barriers and costs to corporate profitability.
* Contextualise Italy's country risks against regional peers using BMI's country comparative Risk Index system.
* Evaluate external threats to doing business in Italy including currency volatility the commodity price boom and protectionist policies.
The Italy Country Risk Report by Business Monitor International (BMI) includes four major sections:Economic OutlookPolitical OutlookOperational RiskandKey Sector Outlook.
Economic Outlook:
How will the Italy' economic policy-making and performance impact on corporate profitability over 2015-2019?
BMI provides our fully independent 5-year forecasts for Italy through end-2019 for more than 50 economic and key industry indicators. We evaluate growth and also forecast the impact of economic management.
Economic Outlook Contents
The Italy Country Risk Report features BMI's forecasts with supporting analysis for 2015 through to end-2019 set against government views and BMI's evaluation of global and regional prospects.
Key Areas Covered:
Data:
* Full 10-year forecasts with data - for key macroeconomic variables including GDP (real growth and per capita) population inflation current account balance and the exchange rate.
* BMI's comprehensive Risk Index system - rates each country worldwide for economic and political risk and rates the business environment within a global and regional context.
Written Analysis:
* Economic Activity - real GDP growth employment inflation consumption (retail sales and confidence).
* Balance of Payments - trade and investment current and capital account.
* Monetary Policy - interest rate trends (bank lending and deposit rates) and inflation (producer price and consumer price).
* Exchange Rate Policy - currency controls foreign investment flows exchange rates and foreign exchange reserves.
* Fiscal Policy - macroeconomic strategy and policies government finance and tax reforms.
* Foreign Direct Investment - approvals inflows and climate.
* External Debt - debt profile (short and long-term plus public and private sector obligations).
* Global Assumptions - forecasts for each year to end-2019 covering: major commodities growth in key regions inflation and interest and exchange rates in the United States Japan China and the eurozone.
Key Benefits
* Rely upon BMI's 100% independent forecast scenarios for Italy and underlying assumptions - we take no advertising and are privately-owned.
* Exploit the benefits of BMI's comprehensive and reliable macroeconomic database on Italy sourced and fully maintained by BMI from an extensive network of private sector government and multilateral contacts.
* Gain key insights into the current and future direction of government economic policy which could significantly affect your company's business prospects from BMI's team of analysts and economists.
Political Outlook:
What are the political risks to doing business in Italy over the next 5-years?
BMI's Italy country Risk Index evaluates the short- and medium-term threats to political stability.
Political Outlook Contents
* SWOT Analysis for the Italy Market - Political Strengths Weaknesses Opportunities and Threats facing Italy.
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