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Italians in for rough economic ride PDF Print E-mail
Sep 27, 2012 at 12:30 PM

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Mario Monti, Italy's premier, yesterday told the United Nations' General Assembly that from a financial point of view, Italy is out of danger. Let's hope he is right but the fact is that the economic situation here is not good and could get worse.

Admittedly, the crisis, la crisi as it is called here, is generally not visible to the casual observer, or even to the not so casual observer, at least here in Rome where I live. Restaurants seem full (although many patrons could be visiting tourists, who are EVERYWHERE!!!), beggars, who for the most part appear to be gypsies or Slavs, seem to be about the same number as before, andyou are not seeing boarded up store fronts or even the same number of empty stores that you now see in Athens. But the statistics tell another story, and it is not a happy one.

The fact is that, says the Consumers' organization, Codacons, that Italians are feeling the pinch to the point that currently they are spending the same amount on food as they did 33 years ago. The decline in per capita consumption by more than three percent "is the worst in the history of the Italian Republic", the organization said on Tuesday, describing the situation as "tragic". It added that the fact that the only supermarkets that are making as much money as they did in 2011 are discount stores, means that many Italians are hungry or at least are being forced to choose cheaper products and to stop buying the leading brands that have always played an important role in keeping the Italian economy going.

The decline in consumption began in 2007 and has continued to slip, now arriving at the levels of 1979. If austerity measures continue - some pensions are being curtailed, or at least there is talk of such a development, and the government has also suggested cutting salaries in the public sector and gas prices are still rising, then things could easily get worse. Add to this the fact that the growth rate of the Italian economy has been stagnant since 2002....

The merchants' association had announced earlier the same day that consumer spending would fall over 3% in 2012. It said that in terms of sales only the phone, computer and supermarket-discount sectors would hold up this year.

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