Categories
Weekly Summaries

24th of May – 30th of May

A possible case of plane hijacking by Belarus

Last weekend, a Ryanair plane on the way from Athens to Vilnius was forced to land in Minsk (Belarus’ capital) by a fighter jet, according to the New York Times. On board was Roman Protasevich, a leading opposition journalist who currently lives in exile in Lithuania. Upon landing, he was immediately arrested on what the New York Times calls “charges of inciting hatred and mass disorder.” He will face imprisonment of more than 12 years if he is found guilty. The international response has been critical of Belarus, with Greece and Lithuania both describing the scenario “hijacking by the Belarusian government” and the E.U. “urging” airlines to avoid flying over Belarus’ airspace. Russia, meanwhile, has stood by Lukashenko’s side.

Other News

  • The former leader of Myanmar, Daw Aung San Suu Kyi, has been seen in public at the court for the first time since the military coup that detained her, ending her term as leader of Myanmar. If she is found guilty of the many charges she faces, she may be imprisoned for life.
  • The one-year anniversary of George Floyd’s killing was last Wednesday.
  • A cable car crash in Italy killed 14 people. Police have now arrested three people, who may be related to the crash.
  • Just as the last of the remaining U.S. troops in Afghanistan are withdrawing, 25 rural Afghan government outposts as well as bases in four provinces have surrendered to the Taliban, according to the New York Times.
  • Just days after Mount Nyiragongo erupted deadly in the Democratic Republic of Congo, another potential eruption forced the evacuation of Goma.
Categories
Analysis

The Economic Situation of Italy

Italy’s economic context

In 2020 Italy’s economy was severely affected by the COVID-19 global crisis, in relation to the fact for which this country was the first in Europe to be influenced by the pandemic consequences.

IMF and GDP growths and losses in WEO’s view

The IMF (International Monetary Fund) estimated a GDP (gross domestic product) loss of 10.5% in 2020 after an output contracted by 18% in the first half of the year.

In fact, the rebound of construction and industrial contributions could not offset the loss of other sectors (especially services and tourism, which accounts for 13% of GDP alone), despite government support. In 2021, a substantial carryover effect should have underpined a GDP rebound of 5.2%, followed by further growth of 2.6% in 2022 (IMF’s October 2020 forecast), though the situation is still uncertain under the nowadays time of the pandemic and the tightening of containment measures in the last quarter of 2020.
In its most recent January 2021 update of the World Economic Outlook, the IMF has revised its GDP growth projections for Italy to 3% in 2021 and 3.6% in 2022 (representing a difference from October 2020 WEO( world economic outlook) projections of -2.2% and +1%, respectively).

Government revenues should benefit from the rebound in economic activity in 2021, so that the deficit is expected to decline to 3.4%. The historically-high debt-to-GDP ratio spiked to a worrying 161.8% in 2020, though it is set to slowly decline to about 156.6% in 2022, thanks to nominal GDP growth and more favourable interest expenditure.
Inflation stagnated in 2020 (0.1%) due to downward pressure from oil prices and private consumption, and should remain subdued in 2021 and 2022 (0.6% and 0.9%, respectively – IMF).
 
Main Indicators 2020 (e) 2021 (e) 2022 (e)
GDP (billions USD) 1.00 2.00 2.00
GDP (Constant Prices, Annual % Change) -10.6 3.0 3.6
GDP per Capita (USD) 30 35 36
General Government Balance (in % of GDP) -3.8 -3.4 -2.9
General Government Gross Debt (in % of GDP) 161.8 158.3 156.6
Inflation Rate (%) 0.1 0.6 0.9
Unemployment Rate (% of the Labour Force) 11.0 11.8 10.8
Current Account (billions USD) 59.64 63.21 68.59
Current Account (in % of GDP) 3.2 3.0 3.1
•Source: IMF – World Economic Outlook •Database: October 2020
•Note 1: (e) Estimated Data
•Note 2: The GDP growth projections for 2021 and 2022 (Constant Prices, Annual % Change) were updated by the IMF in January 2021

Agriculture and economics by 2020

Italy is one of the main agricultural players in the EU, being the biggest European producer of rice, fruits, vegetables and wine.

The agricultural sector represents 1.9% of Italian GDP and is reliant on the import of raw materials utilised in agricultural production due to the country’s limited natural resources (Italian imports of raw materials are responsible for more than 80% of the country’s energy). The country has 12.6 million grounds of agricultural land and its main crops include cereals (particularly wheat), corn, barley, rice and oats. Italy is also the first world producer of wine. In order to respond to the COVID-19-related crisis, the Italian government set up specific schemes for the agro-food sector allocating more than € 1.1 billion.
Nevertheless, in the second quarter of 2020 the primary sector recorded a 12.8% decrease compared to the previous quarter (Italian Council for Agricultural Research and Analysis of Agricultural Economics).

Categories
Weekly Summaries

22nd of February – 28th of February

General Strike in Myanmar

A general strike took place in Myanmar on Monday the 22nd of February. Millions participated, protesting against the military rule that has been in place since the military coup three weeks ago. Last weekend, two protestors and dozens more had been injured when the military started shooting at the protestors. Since then Facebook has banned Myanmar’s military from its platforms, making it obvious that they were siding with the pro-democracy protests.

Other News

  • An order was issued by the Supreme Court which allows the release of the former US President Donald Trump’s tax returns
  • Italy’s ambassador to the Democratic Republic of Congo was among three other people who were killed during an attack close to the city of Goma
  • The Syrian pound reached an all-time low against the dollar on the black market
Categories
Weekly Summaries

25th of January – 31st of January

Elections in Portugal

President Marcelo Rebelo de Sousa was re-elected this past week. He received 61% of the votes, a number that may come as a bit of a surprise because Portugal introduced a new lockdown just two weeks ago over concerns of overwhelmed hospitals. This may also explain the low turnout, which was only 39% of the population. 

President Rebelo de Sousa will begin his second 5-year term with a strong foothold: the candidate with the second highest number of votes — the Socialist candidate Ana Gomes — received only 13% of the votes. In Portugal, the role of President is second to that of the Prime Minister who is in charge of the day-to-day affairs. As President, Marcelo Rebelo de Sousa can, however, dissolve Parliament and veto some legislations and is also involved in foreign policy and national security.

Italy’s Prime Minister Resigns

The Italian Prime Minister Giuseppe Conte resigned this past Tuesday after weeks of political conflicts. At the moment there is still hope that Italian politicians may come up with a solution but otherwise early elections may be the only solution. Especially opposition parties are very keen on early elections with polls suggesting that the Nationalist Party may win. 

Other News

  • The House of Representatives sent an article of impeachment against Donald Trump on Monday.
  • This past Tuesday, President Biden and President Putin agreed to extend the last remaining nuclear arms treaty between the United States and Russia.
  • Thousands of farmers entered New Delhi, India, on Tuesday with their tractors to protest against new farming laws.
  • A new law went into effect in Poland on Wednesday which bans abortions in almost all instances (in cases of rape, incest, and threat to the life of the mother abortions are still allowed). Thousands went to the streets to protest, vowing to keep fighting.