1.4 MILLION ITALIANS MAY GO BANKRUPT BY JULY 2021

The Independent Federation of Italian bankers has released information about what threatens millions of Italian citizens and businesses by mid-summer. According to the experts' forecast, 1.4 million Italians and almost 1.3 million legal entities may be overboard. The reason for this will be the expiration of the governmental decrees that provided residents of Italy with a deferral to pay off debts to the country's credit institutions.

We are talking about debts of the total amount of almost € 300 billion - about 198 billion euros are owed by commercial organizations and 95 billion euros more are owed to banks by ordinary Italians.

The head of the Italian government, Mario Draghi, who was elected last month, is now facing the difficult task of resolving the economic situation in the country. The former head of the European Central Bank will have to solve both the problems of unemployment and the payment of public debt.

During the pandemic, the country has lost billions of euros.

The decline in tourist traffic, and with it the export potential of Italy, led to an increase in the national debt by almost a quarter. It currently accounts for over 155% of GDP. At the same time, the GDP indicator also fell by almost 9%.

The number of unemployed people in Italy has increased by almost a million citizens. Most of them were previously employed in trade, tourism and catering, which turned out to be the most affected by the effects of the pandemic. And although the authorities continued to provide assistance to citizens, providing them with the interest-free loans for billions of euros throughout the entire period of the pandemic, many of the current unemployed previously worked on temporary contracts and were unable to receive the necessary compensation.

Experts note that Italy will have to go through painful reforms, which are one of the leading conditions for the country to receive about € 209 billion from the EU to restore the destroyed economy.

The future development of Italy depends on how effectively the allocated funds will be spent.

We should recall that from March to May last year, the country went through a complete lockdown. Business activity was also suspended in the fall due to the next wave of the pandemic. The previous government issued decrees prohibiting the layoff of workers, but since August, it has only been in effect for those companies that receive government support.