GDP in Italy
Italy - GDP
Italy’s gross domestic product (GDP) is the most important measure for evaluating the performance of Italy’s economy (Economic Growth, GDP). GDP figures are published by the National Institute of Statistics (Instituto Nazionale di Statistica [Istat]) on an annual and quarterly basis. FocusEconomics regularly publishes news on Italian GDP (GDP News). The table below shows the change of price-adjusted GDP for Italy, typically referred to as Italy’s economic growth rate. A more complete assessment of Italy’s GDP can be found below the table.
Italy - GDP Data
|Economic Growth (GDP, annual variation in %)||0.7||1.4||1.7||0.7||0.3|
5 years of economic forecasts for more than 30 economic indicators.
Italy GDP Chart
Source: National Statistical Institute (ISTAT) and FocusEconomics calculations.
OverviewGross domestic product (GDP) measures the economic performance of a country over a given period, typically a year or a quarter. It is therefore the most important economic indicator for evaluating the country’s economy (see our GDP page for more information on this indicator).
Italy’s GDP data (National Accounts [NA]) are produced by The National Institute of Statistics (Instituto Nazionale di Statistica [Istat]). Both annual and quarterly National Accounts are based on the European System of National Accounts (ESA 1995; ESA 2010 as of Q2 2014), which is derived from the System of National Accounts (SNA1993). ESA is a harmonized accounting system which guarantees the consistency and comparability of the statistics produced by all the EU member countries. Italian GDP data reach back to 1970.
Italy GDP Growth Performance
In the 10 years before the financial crisis, Italy’s economy grew on average 1.3%. Due to a sudden halt in private capital flows in 2009 triggered by the global economic crisis, the economy suffered a hefty contraction of 5.5%—the strongest GDP contraction in decades. Since then, the economy has shown no clear trend of recovery. In fact, in 2012 and 2013, GDP contracted 2.4% and 1.8%, respectively.
Structure of Italian Gross Domestic Product
Household consumption is the biggest contributor to GDP growth. Its accounts for more than half of Italy’s economy and has picked up slowly following the crisis. On the other hand, government spending has been declining and now accounts for around one-fifth of the economy. Gross fixed capital formation has a share of approximately 17% of total GDP, while the external balance on goods and services comprises only 2.5% of total GDP. Foreign trade has a smaller role in Italy compared to the other European Union countries. Exports of goods and services account for almost 30% of GDP, while imports account for 28% of GDP.
Italy’s economic structure relies mainly on services and manufacturing. The services sector accounts for almost three quarters of total GDP. Within the services sector, the most important contributors are the wholesale, retail sales and transportation sectors. Industry accounts for a quarter of Italy’s total production. Manufacturing is the most important sub-sector that of the industry sector. The country’s manufacturing is specialized in high-quality goods and is mainly run by small- and medium-sized enterprises. Agriculture contributes the remaining share of total GDP. Italy has also a sizable underground economy, which is more common in the services and agriculture sectors.
When are Italian GDP Data Released?
The National Institute of Statistics releases GDP data through two press releases: Stima preliminare del PIL (flash estimate, only seasonally-adjusted data) and Conti economici trimestrali (detailed estimate).
Istat publishes GDP data on a quarterly and annual basis. The first estimate for the annual figures is released at the end of February of the following year. The preliminary estimate for the quarterly figures gets released approximately 45 days after the end of the reference quarter. More detailed data on quarterly figures are released 25 days after the release of the flash estimate. Instat publishes a detailed calendar in November, giving precise release dates for the following year. The next release dates for Italy’s GDP data are available ( online ).
How are Italy GDP Figures Computed?
Istat calculates Italy’s GDP by applying three approaches: the production, the expenditure and the income approach. The production approach sums the gross value of output of various economic activities net of the intermediate consumption—cost of goods and services used to produce the final goods. The breakdown by the production approach shows output estimates for economic sectors such as: agriculture, mining and quarrying, manufacturing, construction etc.
The expenditure approach calculates GDP through the demand side. It estimates total production by calculating total expenditure of money. The breakdown by expenditure shows estimates for: household final consumption, general government spending, gross fixed capital formation and net exports of goods and services.
Finally, the income approach measures GDP by adding up income from different components of the economy. The income approach shows estimates for: compensation of employees, gross operating surplus of corporations and other mixed income.
How Accurate are Italy GDP Numbers?
Istat publishes the first release of GDP data in order to calculate the deficit as a percentage of GDP as required by the Maastricht principle. The office revises the figures several times, taking into consideration new economic information. An updated version of the data for the two preceding years is released at the end of September. However, the data become final only two or three years after the end of the reference year. Every new release of detailed quarterly data revises data of the current year and the preceding years.
The National Institute of Statistics makes major revisions every 5 to 7 years at which time the entire time series is revised. In case of a change in methodology, the office announces the new techniques in advance. A major revision was performed in summer 2014 when Italy switched from the European System of National and Regional Accounts 1995 (ESA1995) to ESA 2010. Another major revision is expected to happen in late 2014. In May 2014, Istat announced that it would revise the GDP figures starting from October of that year. The new figures take into account estimates of the Italian shadow economy.
Why are Italian GDP Data Important?
Different social and economic operators in Italy use the country’s GDP growth figures in their decision-making processes. The rate of change of the real GDP is a key reference for the media and academia, as well. Some of the policy indicators used to assess Italy’s economic situation are estimated on the basis of GDP. For instance, the ratios of fiscal deficit and public debt as a percentage of GDP–the so-called Maastricht parameters–are used to monitor Italy’s public finances. Moreover, quarterly GDP growth rates are an important reference in the design of the Eurozone’s monetary policy. Italy is the Eurozone’s third largest economy, therefore Italy’s GDP growth data are closely monitored by the market.
Where Can I Get forecasts for Italy’s GDP?
Forecasts for Italy GDP growth are elaborated by many sources; the government, banks, consultancies and think tanks closely watch the Italian economy and update on a regular basis their projections for Italian GDP growth. FocuEconomics collects more 31 different forecasts on Italy GDP and provides an average (Consensus Forecast) from the economists surveyed. Together with the minimum and the maximum projections for Italian GDP growth, you receive a comprehensive overview on Italy’s future GDP growth rates.
Forecasts for Italy’s GDP growth are included in the monthly FocusEconomics Consensus Forecast for Italy, the monthly FocusEconomics Consensus Forecast for the Euro Area and the monthly Major Economies (G7 and BRIC) reports. All reports are available both on an ad-hoc basis and via an annual subscription (including optional Excel support). Download a free sample or purchase the report directly via our Online Store. The report is available immediately after purchase.
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June 24, 2022
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