Suchergebnisse

Economic growth in China is impressive, but underlying weaknesses may erode in time its potential unless measures are taken to further liberalise the economy & reduce the costs of growth. While the contribution of the private sector to growth is becoming dominant, the interference of the party/state with the economy is still an impediment to a better allocation of capital. That is needed to eliminate waste & free resources for both private use & social needs, in particular those of the rural areas whose incomes do not keep up with the pace of growth. On the basis of official data, China has been able to contain state debt & reduce the general public deficit, but the macroeconomic picture suffers from lack of transparency. Recurrent needs of bank consolidation in the near past, the persistence of a large state-dominated banking sector & a more than opaque capital market together with a long established practice of easy credit to state enterprises as well as fiscal engineering on the part of the provincial governments raise the problem of how solid are the financial foundations for growth & how long will the contingent liabilities of the public sector remain tolerable. Excessive capacity built in several sectors could badly suffer from a possible slow down in the world economy. China needs to contain the costs of growth, improve equity & efficiency of public spending, limit growing income disparities & last, but not least, enhance the role & autonomy of the Central Bank in support of stabilisation. More clarity is also needed on the exchange rate regime policy & possible move to managed floating from gradual capital movements' liberalisation. Tables, References. Adapted from the source document.

Taking into consideration the data provided by the 1871 census, the first implemented by the Reign of Italy, the A. underlines that, if under certain aspects (infant mortality rate, illiteracy, life expectancy at birth) the Centre-South of Italy appeared backward in comparison with the North, such a difference was not so deep in the economic field. The heavy public debt, which weighed the new state, was due for 64% to the Reign of Sardinia and to Lombardy. The financial resources, necessary to the new state, were thanks to the gold belonging to the Reign of Naples, the strong increase of the fiscal pressure introduced by the Piedmontese administration, the selling of State and Church properties, new issues of paper currencies. Economic policies that, together with the dismissal of the protectionist policy granted to the industries of the Reign of Naples, damaged the South. making the industrial activities to close down and reducing activity just to agriculture. Thus the difference North-South grew increasingly, being attributed to the Italian politicians, who did not let the South time enough to cope with the new realities. Adapted from the source document.

Long-term trends suggest that Italy's current economic crisis is not the result of an unfavourable business cycle or of the global economic and financial crisis. Instead, Italy's crisis accompanied by persistent slow economic growth is above all the result of decade-long structural shortcomings and impediments. Many factors explain why and how Italy experienced sluggish economic growth and increasingly uncompetitive productivity over decades. The causes of Italy's economic crisis are deeply rooted in the past and strictly interconnected. These causes will be discussed and analysed in a historical perspective. While embracing free economic market principles firmly integrated Italy in an international setting leading to fast export-led economic growth in the 1950s and 1960s, the focus on export-led economic growth became a problem and impediment in the decades after that. Export-led growth favoured the consolidation of a productive system centred around small and medium-sized manufacturing firms, many of which are concentrated in Italy's north. Such firms needed low labour costs, cheap natural resources and energy to survive in an increasingly competitive international setting. Social cohesion and strong domestic consumption, in a setting of relatively low wages, was supported and indeed guaranteed by generous public expenditures. After the oil crisis of the 1970s up until the beginning of the 1990s, Italy was able to remain internationally competitive through the regular devaluation of the Italian lira. Today, due to Italy's Euro membership, this kind of adjustment is no longer possible. At the end of the 1980s, the converging path towards other European countries stopped. The burden of a rising public debt, the distorted composition of public expenditure, the decline of the country's manufacturing sector and insufficient investments into research and development had a negative and lasting impact on the country's competitiveness. But also failures coming from the institutional and political setting, the lack of a good ruling class, the inefficiency of the public administration and family ties, added to what is referred to as Italy "lost opportunities". A ruling class above all oriented at short-term profits instead of a long-term commitments and gains, was unable and unwilling to adopt the needed structural reforms. In order to restore Italian economic growth not only new and effective monetary and fiscal policies, but also and above all changes to Italy's administrative and industrial policies in order to reduce the various kinds of dualism are needed: dualism between the country's north and south, between industries using and not using advanced technology, between regular and temporary workers, between big and medium-small firms, between relatively protected old and not protected young workers. Reducing the above-mentioned dualism is imperative to promote investments in research, infrastructure and human capital and to reduce the dependence on energy imports, the youth unemployment rate and the increasingly growing inner-Italian inequalities and poverty. Adapted from the source document.