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In 2024, the Italian economy recorded a GDP growth of 0.7%, confirming the positive trend already observed in 2023
According to Istat, the improvement in economic indicators is mainly due to the positive contribution of domestic demand (+0.5%) and net foreign demand (+0.4%), while the change in inventories had a slightly negative impact (-0.1%). On the supply side, added value increased in various sectors, with agriculture in the lead (+2.0%), followed by services (+0.6%) and industry (+0.2%).
One of the most significant data in the Istat report concerns the public deficit. The deficit/GDP ratio stood at -3.4%, marking a clear improvement compared to the -7.2% recorded in 2023. This data represents a positive signal for the stability of Italian public finances and for investor confidence. The primary balance, which excludes interest on debt, also recorded a reversal of trend, going from -3.6% to +0.4%. This means that, net of interest, the State has collected more resources than it has spent, a key factor for the sustainability of public debt in the long term. Istat highlighted an increase in the tax burden, which in 2024 reached 42.6% of GDP, compared to 41.4% in 2023. The increase was determined by an increase in tax and contribution revenues (+5.7%), higher than the growth of GDP at current prices (+2.9%). This figure reflects an improvement in the State’s collection capacity, but at the same time highlights a greater fiscal burden for citizens and businesses. Despite the improvement in the deficit, the debt/GDP ratio recorded a slight increase, going from 134.6% in 2023 to 135.3% in 2024. However, if compared with the data for 2021 (145.7%) and 2022 (138.3%), a progressive containment of public debt is evident. The challenge for the coming years will be to maintain this downward trend, ensuring sustainable economic growth and an improvement in the primary balance. The data released by Istat exceeded the government’s forecasts, prompting positive comments from the Minister of Economy and Finance, Giancarlo Giorgetti. “Today’s Istat data confirm, as has always been firmly maintained, that public finances are in a better condition than expected,” said the minister. Giorgetti then underlined how the primary surplus represents a “moral satisfaction” for the government, which updated its growth estimates in December. Despite the positive signs, the minister highlighted the need not to lower our guard: «Of course all this is comforting and a reason for satisfaction. But we cannot stop now: the challenge is growth in a very problematic context not only in Italy but also across Europe».
2024 marks a year of consolidation for the Italian economy, with GDP growing by 0.7%, a significant improvement in the deficit and a positive primary balance. However, the increasing tax burden and the still high public debt remain challenges to be addressed to ensure solid and sustainable growth in the coming years. The government will have to continue working on economic policies aimed at strengthening the country’s competitiveness, stimulating investments and supporting employment to maintain the positive trend. Looking to the future, it will be essential to incentivize productivity and innovation, favouring strategic sectors such as digitalization and the ecological transition. Furthermore, the European and global context, characterized by geopolitical and economic uncertainties, requires a clear strategy to protect growth and reduce inequalities. Structural reforms and a balanced fiscal policy will be crucial tools to address the challenges of the next decade and ensure the country’s economic stability. Furthermore, it will be important to monitor the monetary policies of the European Central Bank, which could influence the cost of credit for families and businesses. Stable interest rates would favor investments, contributing to further growth. Italy will also have to strengthen its positioning in international markets, improving the competitiveness of businesses and supporting exports. Finally, investing in training and digital skills will be crucial to address the challenges of an ever-changing labour market.
Alessandro Fiorentino