The International Economy
Italy's Economy and the European Union
Michael Calingaert is also Executive Vice President of the Council for the United States and Italy. This article was one of three in a series titled "Who's the Comeback Kid? France, Germany, and Italy are struggling to recover. Who'll come out on top?" which appeared in the Fall 2003 edition of The International Economy magazine.
"Eppur si muove" ("and yet it moves") mumbled Galileo under his breath when forced to recant his heretical notion that the Earth moves around the sun. Similarly heretical—though less dangerous—is the notion that there is movement in the Italian economy, indeed, that in many respects it has achieved considerable success.
There are, of course, ample grounds for criticizing Italy's past economic policy and performance. After engaging in a painful effort during the early and mid-1990s, Italy confounded the skeptics by meeting the criteria enabling it to join the European Union's single currency area at its inception in 1999. Since then, however, Italy has slipped to the back of the pack, moving from low GDP growth into recession and showing seemingly little progress in addressing, let alone resolving, a number of fundamental economic problems.
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