Italian parliament approves growth package

CNC report from Rome
Added On August 11, 2013

The Italian parliament has given final approval to a growth package aimed at energizing the country's troubled economy.

The package largely focuses on cutting bureaucracy and streamlining the civil justice system, while reshuffling existing financial resources.
  
The measures give priority to infrastructures by appropriating around 3 billion euros for public projects this year.

That is expected to create 30,000 temporary construction jobs.

Private and business consumers will see total savings of 550 million euros on their electricity bills.

A tax on yachts under 14 meters will be abolished in order to revive the crisis-hit sector.
  
The decree also allocates money to school buildings and roads, and introduces a 25-percent pay cut for senior managers of listed companies under public control.
  
Earlier this week the parliament passed another decree aimed at reducing youth unemployment.

The decree grants tax breaks for companies who employ under-30s or turn their fixed-term contracts into permanent posts.
  
Italy remains mired in the longest recession in more than 20 years.

Data from the national statistics body shows Italian economic output contracted 0.2 percent in the second quarter of 2013 compared to the first one.

But, some reverse trend figures show the euro zone's third largest economy is slowly recovering from the crisis.

The risk premium on Italian bonds hit its lowest since July 2011 on Friday.

Signs show the country is stabilising luring investors.
   
Italian Prime Minister Enrico Letta has assured the European Commission that Italy would keep its target of a 2.9-percent budget deficit this year.

He said his government will make suitable social and fiscal policies while carefully managing state resources.

But, investors still have concerns about Italian politics.

An immediate political crisis was averted last week when former Premier Silvio Berlusconi said Letta government should continue despite the verdict against him.

But, with a divided coalition, Letta warned earlier a "difficult autumn."

Italy's left-right coalition remains split over demands that tax on primary residences be abolished.

Members of Berlusconi's center-right People of Freedom party, a junior partner in the Letta government, said their support was conditional on these demands.