Italy’s COVID-19 slump to last until late 2022: Business lobby

Italy’s economy, the third largest in the eurozone, will only recover from its coronavirus-related slump at the end of next year, the national business lobby Confindustria said Saturday.

After a record fall of 8.9 percent last year -- the biggest in Italy’s postwar history -- gross domestic product (GDP) should expand by 4.1 percent this year and by 4.2 per cent in 2022, the association said.

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“The economy should fill the hole created by the pandemic in 2020 at the end of 2022,” Confindustria said in an economic forecast report.

Confindustria’s forecasts were more optimistic than the International Monetary Fund’s, which last week predicted growth of 4.2 percent and 3.6 percent in 2021 and 2022.

A crucial part of the recovery rests on the success of its so-far struggling vaccination program and on a vast injection of loans and grants from the European Union.

Italy is eligible for around 200 billion euros ($238 billion) from the bloc’s flagship virus recovery fund, but in return, it has to commit to a comprehensive reform plan, subject to Brussels’ approval.

Prime Minister Mario Draghi, the former European Central Bank president who has been tasked with reviving Italy’s economic prospects, is expected to present the plan by the end of the month.

The country badly needs relief from an economic and health emergency which has seen more than 113,500 people die with the coronavirus and almost one million people lose their jobs since February 2020.

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