Political economy
Italy has highly diverse economy which I divided into two; a developed industrial north which is dominated by private companies and a less developed agricultural south.
There is income inequality as the south has the highest unemployment rate. In fact, GDP per individual is more than 40% lower in the south than the north. Additionally, women unemployment is high and their male counterparts are more likely to get jobs despite the women being more qualified.
The three biggest economic issues that Italy faces are the low economic growth and unemployment, sick banks and excessive debt. Although Italy managed to move out of a long recession in 2015, GDP is still too low. The country’s GDP real growth rate was only at 0.8% in 2015 (The World Factbook, np). Italy faces severe unemploym
...ent problem. The rate rose from 8.4% in 2010 to 12.2% in 2015 and it is expected to remain close to that rate in the next two years.
The country is also faced with excessive public debt which stood at 135.8% of the GDP in 2015. Low inflation rate is also a problem in the country given the level of public debt as low inflation has an effect of increasing the real cost of debt. The inflation rate in 2015 stood at 0.3%.
Italy has another economic problem referred to as sick banks. The Non-performing corporate loan ratio is so high, over 25%. The government is even considering erasing these debts from the balance sheets of banks so as to give the bank a fresh start.
The tight monetary policies had contributed to Italy’s poor performance. In 2014, government began utilizing quantitative easing so as to push up
the domestic demand correct the countries interest rates.
Political violence
Italy has had the most governments among the EU after World War II and only one government has lasted for the full five-year term since the end of WW II (Yardley, np).
The organized crime rate is so high in Italy. The sector has been booming year in year out. The country has three significant mafia groups, Ndrengheta, Camorra and Sicilian. During the country’s recession, such groups took advantage of the ordinary citizens by offering loans to businesses and individuals with very high interest rates.
This organized crime groups is due to the high corruption in the government. Corruption is so high that it is estimated that it costs the public about €60 billion every year. The political violence has been evolving over the year and that it remains one of the most violent counties among the EU members and the regimes barely lasts for a full five-year term.
International relations
Italy has a parliamentary type of government. The country’s allies include the members of the European Union, NATO and the G7 countries. The country also plays a big role in the Christian world. This is because Rome, its capital city, is the centre of the Catholic Church and houses the Pope.
Italy has also been involved in the peace keeping missions. It has deployed troops in the Middle East and around the world to help maintain the world peace. The county acts as the mediator in the Palestinian-Israeli conflict. It is also aiming at fighting organized crime and drug trafficking. This is despite the fact that organized crime and drug trafficking is a major problem in the country (Yardley, np).
In fact,
Italy is considered the gateway as well as the consumer of the Latin American Cocaine and the Southwest Asia heroin that enters the European market. The country is also accused of money laundering and smuggling by the organized crimes (The World Factbook np).
References
- "The World Factbook". Cia.gov. N.p., 2016. Web. 17 May 2016. https://www.cia.gov/library/publications/resources/the-world-factbook/geos/it.html
- Yardley, Jim. "Matteo Renzi, Italian Premier, Pushes For A Place At Europe’S Power Table". Nytimes.com. N.p., 2016. Web. 17 May 2016.
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