Italy unveils 17-bln-euro aid package to combat inflation, drought

Italian Prime Minister Mario Draghi announced an aid package
worth an estimated 17 billion euros (17.3 billion U.S. dollars) to
combat surging inflation and drought, Trend reports citing Xinhua.

As head of a caretaker government, Draghi announced that the
Council of Ministers had just approved the latest aid package at
his first press briefing after his official resignation as prime
minister on July 21. He agreed to stay on as head of government in
a caretaker role until a new government can be formed after a
general election scheduled for Sept. 25.

Earlier this year, Italy already approved the 35-billion-euro
economic assistance. Thus, together the two measures total more
than 2 percent of Italy’s gross domestic product, the prime
minister said.

Draghi said the decree was of “extraordinary proportions” and
his goal was to “give the next government the successful
achievement of all the targets” related to the European Union’s
more than 200 billion euros in coronavirus pandemic-related loans
and grants.

According to Draghi, among the measures financed by the new
package will be “the extension of billing and other measures
related to fuel costs, a reevaluation of pensions, and tax cuts”
beyond those financed by the first round of aid this year.

Draghi also said there would be “measures in support of farmers
against drought” as well as funding for targeted local and regional
initiatives and a 200-euro bonus for self-employed workers.

Italy has been bruised by surging prices stemming from the
conflict between Russia and Ukraine, which has pushed global fuel
prices higher and has caused food shortages and disrupted supply
chains. At the end of July, prices in Italy were 7.9 percent higher
than a year earlier, and in June the year-on-year price increase
was 8 percent, the highest in Italy since the creation of the euro
currency.

Itlay has also suffered from unusually hot and dry conditions
this summer. The farmers’ association Coldiretti said the country’s
agricultural output this year would be reduced by at least a third,
with some sectors seeing decreases of more than twice that amount.
On Friday, 19 cities including Rome, Milan, and Turin will be put
on red alert due to high temperatures.

But Draghi said those factors will be reduced by the
government’s steps, and he predicted that despite the challenges,
Italy’s economy this year will still grow faster than those of
France and Germany, the two larger economies in the euro area.