Suche
Mein Konto
Public finances in Paris and Rome: new debt increases despite economic growth
Find out how today is different from the euro crisis: Italy and France are struggling with rising national debt as the economy grows. Experts warn against further adjustments.
Public finances in Paris and Rome: new debt increases despite economic growth
The current development of public finances in France and Italy, the two largest economies in the euro area after Germany, is unpleasant. Despite economic growth that differs from that of Germany, new debt rates are higher than planned. In Italy in particular, the national deficit was 7.2 percent of economic output in 2023, which is well above the government's planned rate of 5.3 percent. Experts are even predicting a further upward revision.
Compared to the euro crisis, today there are some differences in the reaction to bad news from major economies. The excitement about the deterioration of public finances in Paris and Rome remains comparatively low. This could indicate that market participants and politicians can better protect themselves from the effects of growing deficits through targeted measures and structural reforms.
The situation suggests that the Eurozone is better equipped to deal with financial challenges today than it was during the Euro crisis. Nevertheless, the unpleasant news from France and Italy remains a warning signal for the necessary monitoring and control of public finances within the euro area. The increasing new debt despite different economic growth challenges the governments of the affected countries to carry out a more detailed analysis and, if necessary, to take further countermeasures.