(details, adds background)
ROME, September 29 (Businesshala) – Italy has lowered its target for the 2021 public debt to 153.5% of national output from a previous target of 159.8% set in April, according to a draft of a forecast document to be published by the Treasury. Have given. .
The draft of the two-time annual Economic and Financial Document (DEF), seen by Businesshala, was approved by cabinet on Wednesday and new figures are due to be released later in the day.
The latest debt target will mark a fall from a post-war record of 155.6% of registered GDP in 2020, and the downward trend is projected to continue in 2022 with a ratio of 149.4%.
The draft DEF forecast economic growth of 6.0% this year, a partial recovery after a record contraction of 8.9% in 2020, when the economy was hit by the COVID-19 lockdown.
According to the draft, GDP will return to above its pre-COVID levels in 2022 thanks to another year of strong growth of 4.7%.
This year the budget deficit is targeted at 9.4% of GDP, a change from last year’s level of 9.6% and lower than April’s forecast of 11.8%.
The deficit is projected to fall to 5.6% next year, and to 3.3% in 2024, still well above the 3% limit in the EU’s Stability Treaty, which is currently suspended due to the COVID crisis.
Under an unchanged policy scenario, the 2022 deficit would be 4.4% of GDP, the DEF shows, but Rome plans to maintain expansionary policies until 2024 to maintain economic growth.
Prime Minister Mario Draghi and Economy Minister Daniele Franco will present the DEF at a news conference at 1400 GMT. (Reporting by Giuseppe Fonte, Writing by Gavin Jones)