Bank of Italy’s Visco: Italy is 25 years behind
Italy has not been able to keep abreast with the geopolitical, technological and demographic changes of the last 25 years, Bank of Italy governor Ignazio Visco has said in his annual statement.
Visco, who replaced Mario Draghi in 2011, has not spared criticism against Italian politicians.
“The reform action has lost its grip over the last year also due to the deterioration of the political debate,” Visco said.
“Italian politicians find it hard to mediate between the general interest and particular interests,” he added.
Visco also asked not to waste the sacrifices made by the exit from EU’s procedures.
“The efforts made to pursue and consolidate financial stability respond to delays. The exit from the excessive deficit procedure is a first achievement and it should be considered as in investment for the future,” he added.
Companies should aim at integrating global production chains, as well as trying to get more funding from capital markets instead of bank loans.
Visco also said that Italian banks should facilitate and not hamper loans as happened in the past.
The Bank of Italy’s governor also commented on the recent derivatives scandal involving MPS, saying that the bank has operated “with fairness, commitment and accuracy.”
According to Visco, shareholders in any Italian bank will play “a crucial role” in the current difficult situation and should provide financial support by “giving up dividends when necessary” and “accept control dilution and the aggregation with other institutions.”
Visco also said that there is no room for fiscal relief at the moment and that the country’s economy will only begin to expand by the end of the year.
Touching on the issue of unemployment, he pointed out that the rate has doubled compared to 2007 and has reached 11.5%, with a worrying peak of 40% among young people.