Italian industry decimated by long recession

A TENTH of Italy’s industrial orders were lost between March 2012 and March 2013, according to statistics revealed yesterday.

Foreign demand drove a small rise of 1.6 per cent on the month, but the overall picture for Italy’s industry remains sobering.

Industrial sales fell dramatically on the year to March, slipping 7.6 per cent in twelve prior months, and 0.9 per cent since February.

The value of orders has been stagnant or falling since late 2011. Italy entered recession again that year, and has endured seven straight quarters of economic contraction since.

While the whole of the Eurozone remains in recession, performance between different countries varies wildly. German industrial production has also declined in the past 12 months, but performance is considerably more impressive than that of Spain or Italy, where output is in freefall.

Last week, an historically large trade surplus of €22.9bn (£19.5bn) was recorded in the Eurozone. Italy’s trade situation mimicked that of the rest of the currency union, with slightly improved exports outstripped by plunging demand for imported goods.

Earlier this month, the European Central Bank cut interest rates to a record low of 0.5 per cent, down from 0.75 per cent. The reduction was the first for 10 months. It is hoped that lower rates will help the struggling countries on the European periphery.

On Friday, the fledgling Italian government pledged €3bn (£2.54bn) in new relief to households, raising supplements on wages and announcing the suspension of a controversial property tax.