3 hrs ago
Italy’s debt burden rises as borrowing costs and tensions mount
Italy owes a very large amount of money compared with the size of its economy.
The government expects this debt to reach almost 139% of GDP this year.
Borrowing has become more expensive because interest rates on Italian bonds have risen.
Economy Minister Giancarlo Giorgetti said the situation is becoming alarming.
He said wars in Ukraine and the Middle East could push prices higher.
Giorgetti believes this inflation is mainly caused by supply problems, not by people buying too many goods.
Italy plans to remove road tax next year for 14.5 million cars and motorcycles.
It also wants to reduce energy costs and use extra flexibility allowed by the European Union.
The government hopes new deficit figures will help Italy leave the EU’s disciplinary procedure sooner.
Economy Minister Giancarlo Giorgetti called Italy’s rising debt burden alarming.
Public debt is projected to reach nearly 139% of GDP this year.
Three-year BTP yields rose to 3.43%, while seven-year yields reached 3.98%.
Giorgetti said wars in Ukraine and the Middle East could worsen inflation.
The government plans tax relief and energy support while seeking additional EU budget flexibility.
- Who
- Italy and Economy Minister Giancarlo Giorgetti.
- What
- Italy’s public debt and borrowing costs are rising, while the government plans measures to ease pressure on households.
- Where
- The warning was made at a conference in Portofino, Italy.
- When
- The warning was issued on Friday; debt is projected to peak this year, with revised deficit data due next week.
- Why
- Geopolitical tensions, wars, inflationary pressures and higher debt-servicing costs are putting pressure on Italy’s economy.
Key facts
- Projected debt
- Nearly 139% of GDP this year
- Three-year BTP yield
- 3.43%, the highest since June 2024
- Seven-year BTP yield
- 3.98%, the highest since November 2023
- Planned road-tax measure
- Road tax would be scrapped next year for 14.5 million cars and motorcycles
- Estimated road-tax cost
- €2.4 billion
- Additional budget flexibility
- About 0.6% of GDP, or approximately €14 billion through 2028
- EU deficit ceiling
- 3% of GDP
Quotes
Giancarlo Giorgetti
Italy’s economy minister
“Inflation stems from a supply shock,”
firstpost.com









