Italy's Debt Dilemma: President Mattarella's Call for Fiscal Prudence

Italy's President Sergio Mattarella emphasized the urgent need to reduce the country's massive public debt during the Teha economic forum. He highlighted that Italy's debt, which is expected to rise to 140% of GDP by 2026, is a critical issue despite the country's strong history of surpluses. Mattarella urged for financial responsibility as Rome prepares draft budgetary plans for the European Commission.

Italy's President Sergio Mattarella has stressed the urgency of addressing the nation's significant public debt, which is scrutinized by rating agencies and projected to reach nearly 140% of GDP by 2026. Speaking at the Teha economic forum via video link, Mattarella scrutinized market perceptions as a measure of financial solvency.

He pointed out that while Italy historically maintains annual primary government surpluses, the cost of servicing its debt remains disproportionately high compared to neighbors due to interest rates. Mattarella conceded the necessity to decrease debt levels and appealed for measured fiscal policies.

Italy's current public debt stands at approximately 2.9 trillion euros ($3.22 trillion), closely monitored under the EU's Excessive Deficit Procedure. The government, led by Prime Minister Giorgia Meloni, is expected to present plans to reduce the deficit-to-GDP ratio below the EU's 3% ceiling by 2026.

(With inputs from agencies.)