Italy is one of the industrialized countries. She is actively involved in ongoing international development. Experts characterize it as a country with a high level of development, in which a post-industrial economy has been established.
After the end of World War II, its economy was actively developing, which entailed the growth of Italy's GDP. The main reason for this lies in the active influx of American capital, complemented by the improvement of the tourism industry and cheap labor.
Overview of the country's economy
At the present stage of development, the state is one of the largest in the economic sphere. Italy's per capita GDP is similar to that of countries such as the UK and France. And, as you know, it is these countries, including Germany, that are leaders in GDP growth in the European Union.
Currently, the country is experiencing a pronounced budget deficit, which goes beyond the normal 3% value, but it is in the euro zone.
The economy has a characteristic feature in the form of a division into the southern agrarian half and industrial northern regions. In addition, Italy is highly dependent on energy resources - the country imports more than 75% of energy resources along with a huge share of raw materials. On this side, its economy is vulnerable.
A detailed review of Italy's GDP structure makes it clear that the service sector along with tourism is an important part of it. For the development of the latter, the country has all the prerequisites, because Italy has a rich historical past.
Unemployment rates fluctuate somewhat under the influence of internal and external factors. Its average value is about 7.9%, although in some regions it exceeds the mark of 20%.
Sectoral structure of the Italian economy
Note. In general, the sectoral structure of Italy's GDP is as follows:
- agricultural sector - 2%;
- industrial production - 26.7%;
- service industry - 71.3%.
The distribution is uneven. A significant part of industry in Italy's GDP is made up of revenues from the manufacturing and extractive industries. A small part falls on agriculture.
Experts draw attention to the fact that on the Italian territory there are extremely few minerals. It is not surprising that it imports both mineral resources and the bulk of energy carriers.
In the early 80s of the twentieth century, the nuclear industry was actively developed. But by the end of the decade, it was curtailed by the results of the referendum. Therefore, now partially the domestic needs of the state in electricity are met through imported resources.
Agriculture plays a minor role in Italy's GDP. There has been a tendency to increase the number of small farms with a minimum level of profitability. Moreover, the farms themselves are deployed on relatively small areas of several hectares, which is significantly less than the average European farm size in other EU countries.
The emphasis is on the production of wine, olives, olive oil and citrus fruits. The total share of livestock production is about 40%. Italian cheeses and olive oil have become symbols of this country along with pizza and spaghetti!
The largest development in the category of manufacturing was received by the production of automobiles and agricultural machinery along with mechanical engineering. In addition, some manufacturers of textiles, ceramic tiles and furniture factories have gained worldwide fame and recognition.
Characteristics of individual sectors of the economy
In general, Italy's GDP structure is determined by the characteristics of its economy. Today it is in the post-industrial stage of development, the service sector has retained its leading position for many years (over 70%). This is largely due to a modest raw material base and high rates of imports of the necessary energy. A significant part of the latter, the country buys from Russia.
Modern Italy is somewhat lagging behind in the manufacture of technically complex and knowledge-intensive products. Here, the manufacturing industry is developed along with the light industry.
About 35–40% of all industrial workers are employed in mechanical engineering. It gives about 1/3 of the country's total exports. Mostly we are talking about computers and cars. The chemical sector specializing in the production of tires for cars, plastics, pharmaceuticals and more is also actively working.
Food industry products contribute to Italy’s GDP. The country occupies a leading position in the production of pasta along with canned fruit and wine.
In the country's services sector, various directions are presented. But among them, the banking sector is leading along with tourism.
The role of tourism in the Italian economy
The tourism sector has a special place in the modern Italian economy. Not surprisingly, the government pays special attention to it. According to recent studies, the country has been included in the ranking of the most visited by tourists of modern states for several years.
This feature also has negative aspects. So, in recent years there has been a very serious economic crisis that has affected many countries and regions around the world. It was he who contributed to a serious reduction in the flow of tourists.
If previously the tourism industry brought about 19% of Italy's GDP, now this figure barely reaches 12%. Tangible difference.
Italy GDP characteristic by years
Important information. In recent years, economic experts have noted a marked decrease in GDP growth for Italy. So, already after the 2000s, this figure was on average limited to 1.5%. Moreover, these data were recorded at that time, while in the European Union, GDP growth remained at around 2.4%.
A careful examination of Italy's GDP over the years can clearly trace the influence of external factors on the country's economy. So, in 2008-2009. Against the background of another crisis, there was a significant reduction in export indicators, which for the country is the main economy. Against this background, there was a negative GDP growth in 2008 (-1.3%), as well as in 2009 (-5.2%).
A trend towards slight growth has been outlined only since 2010, when GDP again gained positive values of 1.8%.
In general, the period 2008-2016 is characterized by a pronounced drop in GDP. The average annual growth rates in the country were negative or close to zero.
Comparison of Italy's GDP with similar indicators of some countries of the world
What are the differences? In recent years, Italy's GDP has exceeded that of countries such as Austria, Switzerland, Slovenia. Large enough.
At the same time, in the same period, Italy's GDP is significantly less than the similar indicators of the USA, China, Japan, Great Britain, Germany and France. But it is important to note something else. Italian GDP per capita is greater than in Slovenia and China. In a word, there are differences.
When comparing the GDP of Russia and Italy, the leadership of the latter is clearly visible. At the same time, in Russia the gross domestic product relative to the state debt does not exceed 9%, while in Italy it is 120%. In addition, despite a larger GDP, the Italian budget has often been in short supply in recent years, unlike the Russian one.
Real GDP per capita
According to data for 2015, in Italy the per capita GDP indicator amounted to 34 thousand dollars, which exceeded the similar indicators of the previous period. But in general, during 2006-2015, there was a decrease in the real indicator by about 4 thousand dollars. That is, per capita PPP gross domestic product growth stopped at -1.1%.
In accordance with the available statistics, the maximum value of GDP per capita reached in 2007, with a minimum in 2014 (only 33 thousand dollars).
Current state
Recently, experts have recorded a pronounced decline in GDP per capita. On average, it is about 0.4% when analyzing the last two decades.
The Italian economy is growing relative to 1998 figures by 6.2%, while the population has increased by 6.6% at the same time. This led to a decrease in per capita in the country.
Events on the world stage in recent years are unfolding very rapidly. Despite the fact that Italy is included in the Euro zone, this does not guarantee a stable GDP growth. Even taking into account the fact that Greece suffered severely from the global crisis, its GDP is higher than in Italy.
Earlier, the IMF laid out forecasts on which a pronounced increase in GDP was expected. But against the backdrop of turbulence in the global economy as a whole, expectations were only partially met.
