French debts and Italian debts, double standards: editorial by director Napolitano

We’ve been arguing for weeks nowItaly Worth, for the basics of its economy, a classification Obviously better which should be much closer to that France. We have argued that too much of our new debt is being spent on interest, and that after decades of primary surpluses since 1992, and a rediscovery of seriousness in public finances, a positive net fiscal position is emerging from public debt records.Exportand good growth with black Finally, on the front line, the distance that still separates Italy and France in the judgments of international rating agencies is unjustified and, therefore, even more important is the different burden of interests that burdens the two economies as a result of these inconsistent assessments.

Even Le Figaro opened the newspaper with a two-line, full-page headline: French debts are increasing and their costs are increasingly rising. Last Friday, the spread in Paris over the German Bunds rose to 80 compared to 79 in Madrid and 57 in Lisbon. So France is not only performing worse than Spain and Portugal, it is also 50 points away from the same level as Italy’s BTp, as has not happened since the sovereign debt storm. The Governor of the Bank of France, François Villeroy de Galhau, had already voiced his remarks almost single-handedly, saying, in essence, that it had always been said in France that growth could not be punished and, therefore, tasks were deferred to home. As a result it exploded religion.

The news is that the French are waking up and seem to discover, with their usual grandiosity, that they are on the brink of the abyss. The essence is that Italy has already begun to do its homework, and it haseconomy This holds up in an increasingly worrying geopolitical context and maintains government stability, but remains anchored by a low rating of B3. France has not done its duty for decades, has lost the virtue of effective political stability and is struggling more and more. More with its economy, but it maintains a double rating well above ours.

Returning to the primary surplus of this year, all of the new Italian public debt is generated by objectively unjustified interest spending, and the majority of the new French public debt is new spending that it cannot, does not want, or in any case is no longer able to stop. . At this stage, there are two cases: either they raise the Italian rating, or they lower the French rating. It is not possible for there to be a large gap between the two countries.
Honestly, just for the facts, there’s a lot to it. The structural plan for the new budget he presented Giorgetti For Italian public finances, it is very tight with net primary spending at low levels over the next few years and a deficit falling by one point of GDP, i.e. $24 billion in a two-year period, with a structural balance correction of 12 points. Billion annually, which remains practically for the next seven years.

Increase in spending, after years of operation Post Covid It is much slower than its French counterpart, decelerating so severely that it is almost non-existent in real terms, i.e. net calculated inflation. The Italian public debt will decline from 2027, not immediately, only because of the dire consequences of the 110 percent super premium weighing two points per annum, but all this is the cost of the past, not the cost of today’s options. In other words: today we Italians have succeeded in controlling the insane spending and continuing to curb the deficit, to the point that in 2024 we will achieve 3.8% versus the 4.3% we expected in April also because revenues rose much better than expected thanks to the contribution of new jobs resulting from growth.

So, this year also, we have done better than expected and reduced the deficit, and they should continue to correct it upwards. Italian debt fell again as a result of the European revision of GDP in recent years to 134.6, and then rose again to 137.8 as a result of the crisis. Great bonusBut they are all trends in the economy of a country that controls its public finances, continues to grow, and does so more in the South than in the North, and so the convergence is increasing, which will see an actual decline in its debt in relation to… Bill From 2027. Above all, we are talking about a country that, from the second quarter of last year to the second quarter of this year, paid a great deal of interest and incurred little debt while France paid little interest and incurred a lot of debt. In the face of the distance between these real economic numbers and the inverse state of political stability, double standards in governing markets are no longer acceptable.