Macroeconomic aggregates describe the structure of a country's economy and measure its condition and ability to growth. The most important is the gross domestic product (GDP), which is the result of the production activity of a given geographical area.
The resources available (GDP and imports) can be used to purchase goods or services for consumption, for fixed capital formation and for export: final consumption expenditure, gross fixed capital formation and exports are the three components of the aggregate demand. The sum of final consumption expenditure and gross fixed capital formation accounts for the national demand.
Briefly
- In 2019, in Italy, the growth of real per capita GDP slowed down. In absolute value, its level was just below the level registered in 2010.
- In 2019, the level of real per capita GDP in the South and Islands was 45.2% lower than in the Centre-North.
- In 2019, the final consumption expenditure to GDP ratio was stable, compared to 2018. The share of investment grew slightly, but it was still below the EU average.
- On average, in 2020, consumer prices recorded a decrease of -0.2% (+0.6%, in 2019). The turnaround in inflation characterizes all geographical areas and all the regions (except for Umbria where it accelerates by just one tenth)
- In 2019, in Italy, house prices showed a slight decrease, but it was the result of a balance among heterogeneous regional trends: in the North, they grew, while in the Centre and the South they decreased.
- In 2019, Italian exports grew in value (+2.3%), but Italian market share did not change significantly, compared to 2018.
ITALY
An overview
In 2019, in Italy, real gross domestic product (GDP) per capita grew by 0.5%, but the trend was declining, compared to 2018. Compared to 2010, the real per capita GDP remained stable. In 2019, the final consumption expenditure to GDP ratio did not change compared to the previous year, while the gross fixed capital formation to GDP ratio had been growing since 2015.
PER CAPITA GDP (THOUSANDS EUROS, CHAINED VALUES. REFERENCE YEAR 2015)
In 2019, labour productivity did not change, as value added and labour input (measured in hours worked) registered the same growth rate (0.2%). Over the period 2010-2019, labour productivity for the whole economy has increased by 2.5%; the annual growth rate was equal to 0.2%.
In 2020, the annual average rate of change in consumer prices, measured by NIC, was equal to -0.2%; it was the third decrease recorded since 1954, i.e. since the time series of the NIC index was available (-0.4% in 1959, -0.1% in 2016). Similarly to what happened in 2016 (instead in 1959, it was due to various products), the annual negative change in the NIC index is mainly due to the price of energy goods (-8.4% compared to 2019), net of which inflation was positive and slightly accelerating compared to the previous year.
In 2019, house prices decreased on annual basis by 0.1% as a result of opposite dynamics between the prices of existing dwellings (-0.4%) and new dwellings (+1.2%).
In 2019, the exports of goods increased (+2.3%; euro), while the import of goods decreased (-0.7%; euro). These dynamics determined an increase in the trade surplus (+13.7 billion compared to 2018) which, in 2019, amounted to 52.9 billion euros. Net of energy products (electricity and fossil fuels), commercial assets amounted to 91.4 billion euros (+10.4 billion, compared to 2018). Italian market share in the world exports of goods went from 2.85% in 2018 to 2.84% in 2019.
REGIONS Italy and its regions
Over the last decade, Italy has experienced alternating periods of recession and recovery, thereby the real per capita GDP got back to 2010 level. In 2019, compared to 2010, it fell by 2.5% in the South and Islands, while in the Centre-North it grew by 0.2%. The regional gap was still high: in 2019, the real per capita GDP in the South and Islands was 45.2% lower than in the Centre-North and 35.3% lower than the national average. In Calabria (€ 16,367) and Sicilia (€ 17,212) the lowest per capita GDP was registered, preceded by Puglia (€ 18,176) and Campania (€ 18,200). In the Autonomous Province of Bolzano/Bozen (€ 45,875) and Lombardia (€ 38,413) the highest values were registered, followed by the Autonomous Province of Trento, Valle d'Aosta/Vallée d'Aoste and Emilia-Romagna (above 37 thousand euros). In 2019, in most regions, a higher per capita GDP was observed, compared to the previous year. In Sardegna, the most significant increase (+1.4%) was recorded. Instead, in the Autonomous Province of Trento a lower per capita GDP was registered, compared to 2018 (-0.5%).
In 2018, in Lombardia the lowest final domestic consumption to GDP ratio was registered (66.1%), while in Calabria the highest (122%). The incidence of final domestic consumption was still very high in the South and Islands, exceeding 100% in Calabria, Sicilia, Sardegna, Molise and Puglia. The consumption volume increased in all the regions, except for Molise. In the Autonomous Province of Bolzano/Bozen, Veneto, Umbria and Marche, a growth in the final domestic consumption equal to or above 1% was recorded.
In 2018, the lowest gross fixed capital formation to GDP ratio was recorded in Calabria, while the highest in the Autonomous Province of Bolzano/Bozen. The two Autonomous Provinces of Bolzano/Bozen and of Trento recorded the highest growth rates of gross fixed capital formation in real terms. In the same year, labour productivity grew in the South and Islands (+1.4%); while in all the other geographical areas, it decreased: the highest drop was observed in the Northeast (-0.9%). Labour productivity in the South and Islands was 23.5% lower than in the Centre-North.
EXPORTS BY REGIONS. YEAR 2019 (PERCENTAGE COMPOSITION)
In 2020, in eleven regions (Trentino Alto Adige, Campania, Umbria, Calabria, Puglia, Sicily, Piedmont, Abruzzo, Friuli Venezia Giulia, Sardinia and Tuscany) a positive inflation rate or a lower decrease than the national average was registered. In two regions (Basilicata and Marche), an average annual inflation rate equal to the national one was observed, while in the remaining regions a higher decrease in consumer prices was recorded.
In addition, in 2020, the inflation rate was heterogeneous among the regions. In the South, an increase in prices was recorded (+0.2%, but decreasing compared to 2019). In the Islands, an annual average rate equal to zero was registered (but decreasing, compared to last year +0.6%). In the Centre, a value equal to the national rate was observed (-0.2%) and finally, in the Northeast and the North-West a turnaround, with the average annual rate equal to -0.3%, was registered.
In 2019, the trend of house prices was very heterogeneous among the regions: they grew in Northern regions (+ 1.0% in the North-West and + 0.8% in the Northeast), while they decreased in the Central and Southern regions (respectively -1.9% and -0.7%).
In 2019, sales in foreign markets were still strongly concentrated in the regions of the Centre-North (88.8% of national exports). Lombardia (26.7%), Emilia-Romagna (13.9%), Veneto (13.5%), Piemonte (9.8%) and Toscana (9.0%) registered the highest export shares. Moreover, in Lombardia the largest number of export operators was registered (over 57,000).
EUROPE Italy within the European context
The per capita GDP measured in PPS (purchasing power standard) varied widely among the EU countries. In 2019, it ranged from 16,960 euros in Bulgaria to 82,760 euros in Luxembourg. However, over the last decade, European per capita GDPs have been progressively converging. In general, countries, which in 2010 showed the lowest levels, registered a higher increase in per capita GDP.
PER CAPITA GDP. YEAR 2019 (MEASURED IN PPS)
In this context, Italy showed a positive performance: while in 2010 GDP per capita in PPS was 4.5% lower than the EU average, in 2019 it was 5.5% higher than the average. Between 2010 and 2019, in addition to the consistent growth registered in the new Member States, the very good performance of Ireland (+87.4%), Latvia and Romania (both over 70%) stood out. In the same period, only in Greece a decrease in per capita GDP was registered (-1.7%). In Italy the per capita GDP, measured in PPS, increased by 13.5%.
In 2019, in Italy, the final consumption expenditure to GDP ratio, (78.9%) was higher than the EU average (75.3%). Instead, the gross fixed capital formation to GDP ratio (18.1%) was lower than the EU average (21.5%). The EU countries, with the exception of Denmark, Estonia, Hungary, the Netherlands, the Czech Republic, Malta, Luxembourg and Ireland, recorded a final consumption expenditure to GDP ratio equal to over 70%.
In 2019, in Europe, the gross fixed capital formation to GDP ratio varied between the minimum registered in Greece (10.7%) to the maximum in Hungary (27.2%). In Ireland, the real gross fixed capital formation increased by 74.9% compared to 2018, while, among the major countries, the fastest growth was recorded in France (+4.2%).
Between 2015 and 2019, in Italy, the labour productivity increased by 0.5%, but the value was lower than the EU average (+3.4%) and the average computed for the main European countries.
In 2020, the HIPC shows that Italy was among the seven countries registering a negative inflation, albeit not significant (-0.1%, like Portugal), confirming a positive difference compared to the average of the EU, albeit lower than last year (from +0.6 to +0.4 this year).
In 2019, the house prices increased in all the EU countries except for Italy, where they slightly declined (-0.1%). The greatest increases, over ten percentage points, were recorded in Hungary (+ 15.2%) and Luxembourg (+ 10.1%).
In 2019, Germany and France were still the main European markets for the sales of Italian goods (respectively 12.2% and 10.5% of national exports), followed by the United Kingdom (5.2%) and Spain (5.1%). In the same year, the most exported products from Italy to the EU countries were medicines and pharmaceutical preparations (16,622 million euros), motor vehicles (12,497 million euros), other parts and accessories for motor vehicles (9,890 million euros) and iron, cast iron and steel for primary transformation and alloy steel (6,908 million euros).
