Global Politician - Italian Poll Verdict - by Abdul Ruff

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Italian Poll Verdict - by Abdul Ruff

Italy is the fourth largest European economy and has one of the highest per capita incomes in Europe. The country's traditional manufacturing industries suffered a downturn during the final years of the twentieth century, but there have recently been some signs that the economy is beginning to recover from its decade-long slump. Italy's economy has been slipping in the face of low productivity and a strong euro, and analysts say young people, pensioners and low-income workers are feeling the pressure. Although Italy faces a massive public debt, both candidates have promised tax cuts and handouts to voters. The extent of Italy's malaise was made clear only a week before the ballot, when the IMF cut its growth forecast for the country to 0.3% for both 2008 and 2009. That would make Italy's the slowest-growing economy in Europe and among the G8 rich countries. In 2006 it was overtaken by Spain and next year it may fall behind Greece.

The Italian political landscape underwent a seismic shift in the 1990s when the "Clean Hands" operation exposed corruption at the highest levels of politics and big business. Several former prime ministers were implicated and thousands of businessmen and politicians were investigated. In the mid-1990s its GDP per head, at purchasing-power parity, was 20% above the average for the 27 countries in today's European Union. It was richer than Britain and France, and second to Germany among big EU states. Twelve years on, it has fallen below the EU 27 average for the first time.

There are some reasons for hope, though. Italy's employment performance is good: joblessness is at a 30-year low. Exports have been booming, despite the strong euro. Italy's banks have improved under the spur of competition, and they have mostly avoided the sub-prime debt that is dragging down rivals in Europe.