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  • CGTN

Italy's economy set to shrink by 8.3% as virus impact takes its toll

Italy is coming to terms with the battering its economy has taken from the COVID-19 pandemic, with the country's National Institute of Statistics now forecasting it will contract by 8.3 percent in 2020.

The Institute revised its previous projection from December that Italy's economy would grow by 0.6 percent. COVID-19 has killed more than 34,000 people in the country since the start of the year and left the economy in a precarious position.

Just days ago, the Bank of Italy said it expects GDP to fall by 9.2 percent.

Italy's government imposed a nationwide lockdown on 9 March in an attempt to try to limit the spread of the virus and it has had a serious impact on many sections of the economy. Lots of businesses have gone three months without customers or any income.

Italy is now emerging from lockdown with restrictions on movement lifted on 3 June.

Ristorante al Galileo in Milan's city center has been hit hard. At lunchtime, owner Mattia Ashraf has had no customers, he's serving food at the pizzeria to around only 10 people per day.

"Last year, the Italian economy functioned well, however from February everything has changed," he said.

"We have never seen a year like this, It's the first time after 22 years. Maybe you have one year with less work, however the work keeps going, but a year like this ... we have never seen anything like it."

In one of the city's weekly markets near the central station, customers are now returning. Traders are angry about what they perceive to be a lack of financial support from the government during lockdown.

The Italian government promised 740 billion euros ($835 billion) to try to rescue businesses but many of the country's self-employed have only received a one-off 600 euro ($677) payment to compensate for lost income.

"We are really struggling because we were closed for three months. We closed and the government only helped a little. If they had helped us more then the economy would have improved," Leonardo Bruno told CGTN Europe from behind his underwear stall at the market.

Italy is still waiting for the rest of the 27 European Union member states to approve a $195 billion recovery fund to aid the economy.

A severe post-pandemic recession is widely expected and there is a feeling that any money from the EU or Italy's government may arrive too late for struggling businesses that need economic support as soon as possible.

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