Italy: Staff Concluding Statement of the 2023 Article IV Mission

The Italian economy grew robustly over the past year despite sharply higher energy prices. Generous tax credits for building refurbishment and strong tourism spurred growth to an impressive 3.7 percent in 2022, with a further expansion of 1.8 percent (year-on-year) in the first quarter of 2023. Downside risks were mitigated by extensive fiscal compensation to cushion households’ and firms’ real purchasing power, while a natural gas shortage was averted by securing replacement supplies, lowering gas demand, and a mild winter. Employment picked up strongly, with the unemployment rate falling sharply. The public debt ratio has declined by 10 percentage points from its peak in 2020 on the large rebound in nominal GDP. While the energy price spike has largely reversed, broadening price pressures have driven core inflation to high levels

Grenada Staff Concluding Statement of the 2023 Article IV Mission

Grenada is navigating the recovery from the twin shocks of the pandemic and a rise in energy and food prices. The authorities’ decisive policy response—supported by the policy space that was created from past fiscal prudence—provided space to cushion the impact of these shocks. As the recovery takes hold, the immediate policy priorities are to return to the fiscal rules to preserve credibility and to deepen structural reforms to promote robust, inclusive, and sustainable growth. Enhancing the fiscal framework and increasing public expenditure efficiency will help create fiscal buffers against future shocks and make space for the country’s development and resilience building needs. Measures to increase competitiveness, such as promoting gender equality, investing in skills development, and expanding digitalization, would help boost economic growth.

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