![]() ![]() With almost $650 billion in exports of goods and services in 2019, Italy is the second-largest EU exporter, the tenth-largest in the world. Italy is not only the third most populous EU country (the world’s twenty-third) but also the EU’s third-largest economy (the world’s eighth- largest) and part of the G7 group of the world’s most advanced economies. And it’s one of the EU’s largest, most advanced, and open economies. With its 60 million people, $2 trillion GDP as of 2019, and unique historical and geopolitical position at the crossroads of Europe, Africa, and the Middle East, Italy is one of the six founding members of the EU, together with Belgium, France, Germany, Luxembourg, and the Netherlands. In 2019, the EU exported 15 and 25 percent more in dollar value than the U.S. The EU is the world’s biggest exporter of manufactured goods and services and the largest import market for over 100 countries. (73 percent in 2019), these countries account for the largest trade block in the world. With a GDP that is about three quarters of that of the U.S. Background: The EU and Italy at a glanceĬreated with the Maastricht Treaty of 1993 and guided by the European Council and the European Commission, the EU is a federation of 27 countries with its own parliament that covers much of the European continent, across which goods and people freely flow under a common regulatory framework. The second part of the policy brief reviews the fiscal measures adopted by Italy and the EU in response to the pandemic and assesses the opportunities that NGEU offers to Italy as well as the policy challenges ahead. and Italy, New York City and Milan, respectively. We will consider the specific health and economic emergencies that Italy has faced and contrast the experiences of two major cities in the U.S. By the end of this past June, Italy had suffered 2,110 deaths per million people relative to the 1,827 recorded in the U.S. ![]() The first part of this policy brief examines how the pandemic unfolded in Italy, whose experience in many ways has mirrored that in the U.S. The budget for the plan, part of the 2021-2027 EU budget of 2 trillion euros, represents the largest stimulus package ever financed by the EU. An outcome of such a process has been the approval of an ambitious recovery plan called “Next Generation EU” (NGEU), worth nearly 800 billion euros, which is meant to support member countries in the aftermath of the crisis and to set the EU toward a stable path of sustained long-term growth. The crisis has cast a new light on the ability of the EU to confront global challenges and spurred a rethinking of its role vis-à-vis member countries. during the current and past recessions, are heavily restricted - if not specifically prohibited.Īddressing the pandemic, from the control of contagions to the development and the distribution of vaccines, has repeatedly tested the EU’s institutional coordination and readiness of response. But fiscal measures by member countries such as targeted transfers to specific constituencies (“bailouts”), which have been employed in the U.S. Most decisions about taxes and spending occur at the national level. In the U.S., the corresponding figure was almost 21 percent. ![]() As of 2019, the EU budget accounted for less than 1 percent of its gross national income. Unlike the U.S., the EU is a political and economic union that binds only 19 of its members by a common currency, the euro, but is not fiscally integrated. For the bloc of 27 European countries and roughly 500 million people that constitute the European Union (EU), these challenges have been coupled with those stemming from its peculiar design. The COVID-19 pandemic has presented the world with challenges that are unprecedented in recent times. Funds are to be invested in specific areas such as health and technology and are granted on the premise that Italy implements much needed structural reforms. A key dimension of the plan is its conditionality.In today’s dollars, that’s eight times the post-WWII Marshall Plan. To help Italy and other nations recover from the pandemic, the EU has approved an 800 billion euro recovery plan.Italy was surprised by a crisis that may have required less strict but longer and more targeted mitigation policies, which could have reduced its death toll at the same output cost.With a significantly older population and a high fraction of younger individuals living with older relatives than most other countries, Italy has proved highly vulnerable to the spread of the virus.Stanford King Center on Global Development.Stanford Environmental and Energy Policy Analysis Center (SEEPAC).Stanford Center on China's Economy and Institutions (SCCEI).California Policy Research Initiative (CAPRI).
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