MBA Italy

Italian Economy

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Italy has progressed during the last 15 years from being an economy based on agriculture to an economy which is mostly based on industry. Although a gap still exists between the north and the south of Italy; the Southern Italy is basically agricultural. The North, on the opposite, is industrialized especially in the automobile field (Fiat, Lancia, Alfa Romeo).

Milan is Italy's most important economical centre, with industrial development and textile manufacturing. Milan is also noted for its fashion industry and production of electronic goods.

Italy's economic strength is in the processing and the manufacturing of goods, mostly in small and medium-sized firms which are often family owned. Out of a total of 35,000 joint stock companies, 13,000 have fewer than ten employees. They manufacture products that are technologically moderately advanced and therefore increasingly face crushing international competition.

Italian economy today records an improvement of the employment situation. The services and construction sectors are the most dynamic; the number of jobs in these industries remains stable and continues to drop in agriculture. Another important reason for this improvement is a high level of self-employment and small businesses.

Italy's Economy Facts

  • Italy has developed into an industrial country ranked as the world's 5th largest economy in USD exchange-rate terms and 7th largest in terms of purchasing power parity (PPP).
  • Italy is the leading world producer of olive oil and wine.
  • Major industries in Italy are precision machinery, motor vehicles, chemicals, pharmaceuticals, electric goods, fashion and clothing.
  • Italy belongs to the Group of Eight (G-8) industrialized nations.
  • The main exports of Italy include machines and transportation equipment, chemical products, clothing and shoes.
  • Tourism is Italy's third biggest source of foreign income after machinery and textiles and clothing.

Economy Statistics

These are some of the most important statistics of Italy's economy :

Currency 1 euro (€) = 100 cents
GDP Ranking 8th (2005 est.)
GDP Purchasing power parity - $1.698 trillion (2005 est.)
GDP - real growth rate 0.1% (2005 est.)
GDP-per capita $29,200 (2005 est.)
GDP-composition by sector Agriculture: 2.1%
industry: 28.8%
Services: 69.1% (2005 est.)
Inflation 1.9% (2005 est.)
Labor force 24.49 million (2004 est.)
Labor force - by occupation Services 63%
industry 32%
agriculture 5% (2004 est.)
Unemployment rate 7.9% sep 2005
Budget Revenues: $785.7 billion
expenditures: $861.5 billion; including capital expenditures of $NA (2005 est.)
Trading Partners
Exports $371.9 billion f.o.b. (2005 est.)
Exports - partners Germany 13.6%
France 12.3%
U.S. 8.0%
Spain 7.2%
UK 6.9%
Switzerland 4.2% (2004 est.)
Imports $369.2 billion f.o.b. (2005 est.)
Imports - partners Germany 18%
France 11%
Netherlands 5.9%
Spain 4.7%
Belgium 4.5%
UK 4.3%
China 4.1% (2004)
Public Finances
Public Debt 107.3% of GDP (2005 est.)
Debt - external $1.682 trillion (30 June 2005 est.)
Economic aid - donor ODA, $1 billion (2002 est.)

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