Italy heading to stronger recovery, says ECB chief Draghi

26 marzo 2015

2 min di lettura

(AGI) Rome, Mar 26 - There are signs of confidence that "therecovery, to date weak, is gaining strength and stability",said President of the European Central Bank Mario Draghispeaking to the Finance, Budget and EU Policies committees ofthe Chamber of Deputies. "At the moment the economic situationis more favourable than in recent months - and the main reasonsare the positive effects of the collapse in energy productprices, the expansionary monetary policy and structural reformsundertaken in several countries of the area whose effects arebeginning to be felt." The ECB president said that inflationwould return to around 2 percent. The ECB will also play itspart in restoring growth in the euro area in terms ofpotential, but to achieve this aim we need the structuralreforms that eurozone countries have to carry through. Thespread that Italy paid at the end of 2011, with a yield of 7percent on 10-year BTP bonds versus 2 percent for German ones,stood at 500 basis points. "Incidentally, this spread of 500basis points is exactly the spread that we paid on average for15 years before joining the euro, so anyone wanting to makecomparisons has a prime instrument." Mr Draghi added: "In Italythere is a high concentration of micro enterprises with limitedcompetitiveness and there is legislation that createsincentives for them to remain micro enterprises." "Italy," henoted, "has the slowest civil justice in Europe. In recentyears there have been several interventions. It's not thatthere has been no progress, but we must continue on this path."In this regard, Mr Draghi mentioned the time taken forbankruptcy proceedings, which impacts negatively on investment."To complete a case in Italy takes five years, in Germany andSpain one," said the president of the ECB, who quoted studiesthat estimate an increase from 8 percent to 12 percent of theaverage size of firms with a halving of the time taken by thecivil justice system. "We need clear, established rules,compliance with the law and respect for contracts," Draghiadded, also pointing the finger at a "tax treatment thatpenalises businesses over certain thresholds" and thusdiscourages expansion. (AGI). .