Italy Business Lobby urges energy reform and investment to revive growth

The head of Italy’s largest business group on Tuesday called for sweeping reforms to revive the near-stagnant country’s economy. He warned that high energy costs and low investment undermined growth.

Emanuele orsini, president of Confindustria, said that the price of energy has become a threat to companies. He called for immediate action to lower costs and increase competitiveness.

He said that Italy's underperformance over the years is a clear indication of urgent change.

He said that the economy has only grown 0.4% annually on average over the last 25 years. This compares to 1.4% for the European Union, and 2.1% for the United States, as well as 8% growth in China.

Orsini stated that the power costs of Italian companies were 'amongst the highest in Europe'. He also called for quicker approvals for renewable project, noting that 4,000 permits have been blocked and 131 gigawatts are waiting for authorisation.

He said that Italy has installed 85 GW, but needs to install another 50 GW in four years.

He said that the demand for electricity could double in 25 years from 300 to 600 Terawatt Hours, driven by artificial intelligence. Italy needs to expand its grid infrastructure and improve connections.

He urged the return of nuclear power and small modular reactors to ensure stable supply.

Orsini, who is also a proponent of energy policy, called for policies that would help small businesses?scale-up,? including stronger incentives for mergers, and targeted industrial assistance, because larger companies were more productive and competitive internationally.

Confindustria, a group that advocates for tax reductions for corporations and government subsidies for workers, is not known for its willingness to offer wage increases to its members. Italian salaries are below 1990 inflation-adjusted levels.

Orsini proposed, however, to review 575 tax breaks which erode the tax base by around 120 billion euro, and to reallocate 20 billion euros equally between growth, healthcare, and education. (written by Gavin Jones and edited by Gianluca Smeraro).

(source: Reuters)