According to Italy’s finance chief officer, their government is taking necessary measures on its spending plans. Because of the widespread coronavirus pandemic which has caused over 12000 deaths.
Statistical observations ranked Italy as the worst-hit state in Europe with about 105792 people infected by the virus. Data reports from Hopkins University reveal the country had been on lockdown since the onset of March. To mean its commercial activities stopped. Italians have been asked to curtail their movements. Persons are only allowed to leave their houses to purchase medicine and food. They are uncertain of when a normal lifestyle will resume. However, during a briefing on Wednesday the state’s health minister announced that the lockdown measures will run up to 13th April.
What does Roverto mean by new fiscal measures
Last month, the Italian government set aside a fiscal package worth $27.35 billion for the management of businesses. Nonetheless, Roverto Gualtieri, Economy, and Finance Minister said on Wednesday that
“new fiscal measures will be significantly larger.”
By this, he meant that they will use new measures to help support Italian companies and people during the pandemic.
The reason why the Italian government has asked for help from the European Nations
Italy and France were cautioned by Brussels because of high levels of public debt. This threatens their future budgets and risk breaking EU rules. According to Eurostat, since the adoption of free-spending policies, Italy remains indebted to the EU. However, coronavirus pandemic is a crisis that requires global solidarity. The situation in Italy requires intervention from the E.U.
The Italian government needs the EU to engage in concrete emergency actions to help save Italy. They need relief on new medical equipment. With new cases reported daily, there is a shortage of equipment. However, it was quite unfortunate as no EU state responded to the plea. This points a question mark to EU unity.
Though the novel virus pandemic has affected Europe as a whole the impact is great in Italy. Tourism, Industrial services, trade are all affected. The country is in need of damage control. It is during this occasion that Europe countries need to engage extraordinarily to save drowning vessels. If not, the entire European economy will be affected.
Uncohesive reaction to solidarity
Italy and eight other nations formed a union, “corona bond”. This is a mechanism they developed to cost-share the finances from the crises. Unfortunately, Germany, Netherlands and some other wealthy countries disregarded the idea. Saying combining their debts with highly indebted states will endanger their economies. Conte, Prime Minister of Italy condemned this act saying lack of solidarity will impact Europe as a whole.
“If the reaction is not cohesive, vigorous, coordinated, Europe will become less and less competitive in the global market space, “Conte said in his TV address, according to the newspaper II Messagero.
With no meaningful decision arrived at by the heads of EU member states the European economy will face a brick wall. During a briefing on Wednesday, Valerii De Molli, Chief executive officer at The European House Ambrosetti stated that if their system collapsed then German will also fall. He cautioned that most of the car parts are manufactured in Italy. Without production, the global economy will be affected.
Nonetheless, the EU is preparing $40.5 billion to allocate to 27 member states. The European Central Bank has also announced a huge stimulus program amounting to $820 billion in bond purchases till the end of the year.