Italy: Unraveling The Italian Economy

Italy is the 4rd largest economy in Europe. Italian economy is also the 8th largest economy in the world by GDP.

Talking about the country’s romanticized image with pasta, pizza and operas remains acceptable, but talk about the country’s image with fast trains, and everyone pulls back and considers it not much “Italian”. The truth is that Italy was painted in the corner as a basket case and a backward European member while that's not the case. Italy is the tenth biggest exporting nation and a leading economy in many sectors including machinery, vehicles, pharmaceuticals, precious metals, clothing, and accessories, etc. With nearly 60 percent of its trade with the European Union, Italy is the second-biggest manufacturing country in Europe fueled by small to medium-sized enterprises.

The video also discusses Marshall plan by United States, European Common Market, “Hot Autumn”, a series of strikes from 1969 to 1970, and “Years of Lead”. It also discusses Euro Convergence Criteria of 90s, Red Tape and recession, and 2008 financial crisis's impact on the Italian economy followed by Euro-Zone Debt Crisis and another recession.

The video also highlights Political instability, large coalitions and corruption in the government sector. We have also mentioned the debt to GDP ratio, government spending, pension system of the country, baby pensioners, impact of Euro replacing Lira compared to Netherlands and Germany, and Italy's idea of parallel currency.

The video also depicts labour laws and employers protection as well as youth unemployment in the country along with cultural inclinations like living long with parents impacting economic decisions. Other factors include highest older population with low fertility rates.

Italian economy also suffers from the inequality between the southern and northern regions.

The video also discusses Italy's prestigious automotive industry with car brands like Ferrari, Maserati, Lamborghini, Alfa Romeo, and Ducati bikes

Last, we discussed the travel and tourism industry of Italy including mentions of From Rome’s Colosseum to Florence’s Duomo Santa Maria del Fiore, From Milan’s Duomo to the Grand Canal of Venice, From Leaning Tower of Pisa to Lake Como.

#Italy #Italian #venice

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[becconvideo]

In Germany the situation is serious but not hopeless. In Italy the situation is hopeless but not serious. :-)

[jacopoabbruscato]

We spend a lot on pensions because there was a period of time in the 80s and early 90s when state employees (teachers, government officials, bureaucracy staff, railway and police higher-ups) could retire very early. There's quite a number of people in their 60s and 70s who have been retired for 30-40 years after working for half of that. And they criticize young people because "Youngsters today don't want to work".

[EnzuccioGameplays]

Being Italian, I can confirm that every point discussed in this video is objectively explained and, considering the limited format in time of the video, has given a very good portrait of the overall situation, in my opinion.

[itsme]

apart from cultural reasons, the reason why young italians dont move out soon is related to what youve said in the video: finding a decent job is hard and buying an house requires money that a regular italian 20 yo doesnt have
- a 19yo italian that would love to move out but is very far from being able to

[bubastis]

I hope Italians know how beloved their nation is outside their borders. In North America especially Italy is considered one of the most beautiful countries in the world. So much culture and history and not an endless sea of strip malls and parking lots.

[kyral]

I would like to hear some thoughts about his, but I genuenly belive that one main thing which Italy needs is confidence. I know, it might sound insignificantly, but I caught the impression that Italians have gotten such a bad image that they don't even belive themselves in fixing their country's problems.

[eurotop]

PIIGS: typical British offensive acronyms.

[ZOMBIEVIOLENTO]

As an italian i want to thanks u for this very accurate job. Not even an italian would be so precise in every aspects. Well done mate keep doing like this

[kurtb]

Our cars are more practical, but the Italian ones look cooler. 🇩🇪❤️🇮🇹

[praetorianguard]

I must be honest with you, this is one of the BEST videos about italian economy I have ever seen! Finally someone that doesn't fall for the same, old, stupid stereotypes and tries to see things objectively! Well done! I can see you made good research.
To add something, Italy is one of the countries with the highest private saving rates in the world. Italian private saving is 2 times bigger than the public debt! But this leads to another problem with the italian economy.
Italians tend to save A LOT. They don't spend that much, prefer saving for the future, so privately italians are wealthy but the state is poor.

[KeejoeMusic]

I fully agree with the point that one of the main issues about Italy is that italians don't really trust the government - because of many regrettable decisions politicians made in the last decades -, that makes many business don't feel any kind of guilt by evading taxes, because "even by doing so, things wouldn't change for the better". Sadly, it's a common thought

[AB-udin]

The job market in Italy truly benefits no one. Wages can sometimes be so low that it is more lucrative for people to just not work and live on older family members’ pentions. There is no minimum wage, taxes are high, unemployment money is often given unfairly. On the other hand as you said, employees have to be extremely careful about who they hire, since it’s very hard to fire people. This vicious cycle creates a sense of hopelessness and stagnation that I have yet to experience in any other developed country.

[giancarlodirovasenda]

As an Italian i feell the day that we will have a reliable and transparent public service I think trust among Italian consumers will finally rise and an economic boom created by internal demand will occur. But until Italian institutions and bureaucracy remain prone to inefficiency and corruption it will be hard to assist to a full economic recovery. we cant relyonly on exports forever

[Oyzatt]

As a foreigner living Italy, I will say your video is clearly explained and lucid.

[MultiTheflyer]

Very well done! I am in italian and hold a degree in economics and I must say this was pretty spot on. There are only a few comments that I would like to add:

- The fact that people move out relatively late is not just due to cultural reasons. Cities and industrial areas where it's generally easier to find a job are relatively pricy on a real estate standpoint while the salaries are low. For example, a very lucky young graduate (I'm talking master's degree etc), will make approximately 1400 eur per month as salary, while the rent for an apartment in Milan is at least 800 eur (living on your own far from the center). If you compare the figures for an average German graduate in Berlin, which makes more than 2000 eur and has cheaper rent as far as I understand, I'm sure the message is clear.

Obviously, this is not the same throughout the whole country but I'm willing to bet that we have one the highest rent/salary ratios in the world. I would argue that one of the reasons is that, because of the many regulations, it's very difficult (and costly) to build a house from scratch and therefore offer in the real estate market is not very flexible. That is because there are so many cultural preservation and environmental regulations that you can't even imagine. Plus it takes ages to get permits depending on where you are. For example, I was recently trying to install a roof window in an old farmhouse/apartment in the middle of nowhere. I had to ask for an authorization that was eventually rejected (after 6 months) because the building is in an area of "historical importance". I can assure you, it's a piece of crap farmhouse in the middle of the nowhere. And that's for a roof window. Imagine building a whole house.

- Another reason why our economy is so ineffective is the extremely slow and ineffective rule of law. Businesses don't want to wait 5 years to see their disputes settled. Sometimes they won't even invest in the country because of it. It is a real issue especially in times of crises. E.G. : company A does not pay company B. Company B cannot wait 5 years for the ruling to get it, it will therefore either sell its credit to a bank for a big discount or go bankrupt because it need the money right now.

- You are right, entrepreneurship is not very much encouraged in the country. Culturally we tend to prefer safer jobs. A testament to this is the fact that our startup ecosystem it's basically non existant compared to other european countries. You could argue that we don't have entrepreneurs/startups because we don't have an ecosystem, it probably goes both ways. However, our culture does not really encourage risk taking and I bet any italian I know would say that his or her family would tell him that he was mad if he expressed the wish of starting a company from scratch instead of getting hired somewhere.

- We have a serious skill mismatch problems. 10% of the population is unemployed, nevertheless companies cannot find the profiles that they want to hire. That's because unemployed people are generally low skilled while companies require things like engineers and data scientists. Data scientists and engineers tend to leave the country and go live somewhere where they can earn significantly higher salaries like Germany or Switzerland.

I could probably go on for an hour or so, hopefully whatever I wrote was interesting to someone,

Cheers

[stefanomorandi]

I do not think that joining the euro was a bad idea, it’s the opposite. In 20 years Italy saved 700 billion euros in terms of less interest on the debt, the problem was and will ever be its political class; joining a currency union requires strong reforms and a change from a public spending and inflationary mode to a more open and stable system, a change that Italy didn’t take because it’s not politically feasible. The biggest economic problem of Italy, in my opinion, is not in its economy but in its political class, a class that, after the government of Super Mario Draghi, will strike again in its poor competence and blind view of the future.

[Bhethar]

In my experience the greatest issue in Italy is taxes and bureaucracy. I once wanted to open a business with my uni friends. The state expect you to pay a ridiculously high amount of taxes BEFORE you even generate any profit. Not to mention its impossible to hire due to the overcomplicated requirements. Despite its young population tending to be very creative, banks and financial institutions are overly conservative and don't really understand much about innovation and as a result, startups often have to migrate abroad. It does not help that politics is either ruled by ex communists converted to bankers on the left and racist criminals on the right.

[gio.c]

The “P.I.I.G.S” that got me 😂 sorry! Great video as usual and nice and clear English us non natives

[edoardospallarossa]

The fact that Italians leave the family around 25-30 years is related to the cost of life. Here in Italy when you get your graduation for the first 2/3 years you can change many jobs that the most of the time give you from 600 to 900€ per month and if you consider that a rent costs 600€ or more, if you live in cities like Milano, Roma, etc. a young man/women can't afford to live their lives so is better to live with your parents and divide all the expenses for these two or three years and when you find a better job or you get a promotion than most of the Italians move out. I'm one of these Italian and it's not related to the union we have with our families it's only a matter of how are we going to live with only 600€ per month.
I find the rest of the video very interesting and mostly very specific and I can see or better hear that you have studied what Italy is capable and what really makes this country the third economic country in Europe. Thank you for not saying that we are just pizza, mandolino and Mafia. Italy has a lot to offer and I think most of the people just by searching on the internet can see what we really can do and what we made, but as you say we lost most of our hope in the politicians and institutions for the most diverse reasons, but I can see in my generation (20-25 years old) that we want to change in a better way our prospective and change this country in better in every aspect

[xmaniac]

What Italy needs is to return to its Machiavellian politics.
Think about all the damage that been done by the USA and its corporations to Olivetti, ENI and the scheming with the nuclear power plant and rearmament programme in the 1980s that so heavily indebted our nation. We are better of allying with out best frenemies; France and Germany. I truly believe this tripartite alliance would be an unstoppable economic engine, but it can only work if we leave our big ego's home.