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ECONOMY

IMF increases its growth forecast for Italy

The International Monetary Fund (IMF) on Monday increased its 2017 growth forecast for Italy to 1.3 percent from the previously more modest 0.8 percent.

IMF increases its growth forecast for Italy
File photo: riverlim/Depositphotos

But Italy's GDP growth will slow through 2018-2020 to reach 1 percent, the IMF said in its report following an annual mission to the country.

The Italian government itself has cautiously forecast growth of 1.1 percent in 2017 and 1 percent next year. Italy's economic growth remains one of the weakest in the European Union, according to the IMF.

ANALYSIS: Why Italy is still Europe's poor relation

“Weak productivity and low aggregate investment remain key challenges for faster growth, held back by structural weaknesses, high public debt, and impaired bank balance sheets,” it said.

The IMF called on Italy to accelerate the process of cleaning up the banking sector, weighed down by dodgy debt made up of loans which risk never being paid back.

These amount to some 350 billion euros gross, one of the highest levels ever in the eurozone.

Italy is currently being run by caretaker Prime Minister Paolo Gentiloni and the uncertainty over what comes next is seen as dampening an economy saddled with unemployment over 11.5 percent of the workforce.

While the made-in-Italy brand is as strong as ever in fashion-related luxury and food and drink, in other sectors the country is suffering from declining competitiveness while international rivals forge ahead on that front.

A snail-paced legal system and mountains of red tape are also long-established complaints of the Italian business community.

READ ALSO: Italy mulls plan to scrap one- and two-cent coinsItaly mulls plan to scrap one- and two-cent coinsFile photo: macniak/Depositphotos


 

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SAS

‘We agree to disagree’: Still no progress in marathon SAS strike talks

By lunchtime on Friday, talks between the Scandinavian airline SAS and unions representing striking pilots were still stuck on "difficult issues".

'We agree to disagree': Still no progress in marathon SAS strike talks

“We agree that we disagree,” Roger Klokset, from the Norwegian pilots’ union, said at lunchtime outside the headquarters of the Confederation of Swedish Enterprise in Stockholm, where talks are taking place. “We are still working to find a solution, and so long as there is still some point in continuing negotiations, we will do that.” 

Mats Ruland, a mediator for the Norwegian government, said that there were “still several difficult issues which need to be solved”. 

At 1pm on Friday, the two sides took a short break from the talks for lunch, after starting at 9am. On Thursday, they negotiated for 15 hours, breaking off at 1am on Friday morning. 

READ ALSO: What’s the latest on the SAS plane strike?

Marianne Hernæs, SAS’s negotiator on Friday told journalists she was tired after sitting at the negotiating table long into the night. 

“We need to find a model where we can meet in the middle and which can ensure that we pull in the income that we are dependent on,” she said. 

Klokset said that there was “a good atmosphere” in the talks, and that the unions were sticking together to represent their members.

“I think we’ve been extremely flexible so far. It’s ‘out of this world’,’ said Henrik Thyregod, with the Danish pilots’ union. 

“This could have been solved back in December if SAS had not made unreasonable demands on the pilots,” Klokset added. 

The strike, which is now in its 12th day, has cost SAS up to 130m kronor a day, with 2,550 flights cancelled by Thursday, affecting 270,000 passengers. 

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