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Italian government unveils a stimulus plan

29 November 2008 08:22 (UTC +04:00)

Baku-APA. Italy has unveiled a stimulus package including tax breaks for companies and poorer households as well as measures intended to ensure banks keep lending to businesses.
The plan was valued at 80 billion euros and included 16.6 billion euros for infrastructures and 2.4 billion euros for low income families.
It also includes measures to ensure liquidity for banks, speed up tax reimbursements and help homeowners finance or refinance their mortgages.
Other measures in the plan included tax breaks for businesses, a crackdown on tax evasion and a freeze on fee hikes for utilities and motorways.
Italian Economy Minister Giulio Tremonti said the package will not weigh on the state budget or public debt and that Italy would remain within the eurozone deficit limits.
National statistics bureau Istat made it official on Friday that the Italian economy was in a recession, the first since 2005 and the worst since the end of 1992 and the start of 1993.
According to Istat, GDP fell 0.5% in the third quarter compared to the previous quarter and 0.9% compared to the same quarter in 2007.
The 0.5% drop followed a quarterly decline of 0.4% in the second quarter and was greater than the 0.3% retreat Istat had been expecting.
The 15-nation eurozone also fell into a recession in the third quarter with average GDP down 0.2% for the second quarter in a row.
This was in part due to a 0.5% GDP drop for Germany, Europeâ€™s biggest economy.
Britain, which is not part of the eurozone, also saw its GDP fall by 0.5 in the third quarter.
Average GDP for the full 27-nation European Union retreated by 0.2% but this did not indicate a recession because there was zero growth, thus no decline, in the second quarter.