“We regret to note the Commission’s technical failure,” the ministry said in a statement, describing the forecast as “an inadequate and partial analysis” of the populist government’s 2019 budget plan.
The EU predicted that Italy will be the slowest-growing economy in the eurozone through 2020, and that its deficit will reach 2.9 per cent of GDP next year, much bigger than the 1.7 per cent in its previous forecast and the 2.4 per cent predicted by Italy.
The Commission also expects the Italian economy, the eurozone’s third-largest, to grow by only 1.2 per cent in 2019, below the 1.5 per cent projected by the government.
Despite the gloomy forecast, Italian Prime Minister Giuseppe Conte said the coalition government won’t change its budget proposal.
“The Commission growth forecast for next year underestimates the positive impact of our economic maneuver and our structural reforms,” he said.
“We are going ahead with our estimates on the public finances, with growth that will increase and debt and deficit that will decrease.”
At a staggering 131 per cent, Italy has the second-largest debt in the eurozone, after Greece.
The country’s ambitious budget plan has raised concerns for the future of the euro.
However, the Italian government believes that big spending is necessary in order to revive the nation’s economy.
As tensions simmer between Italy and the EU, the Italian government stated that is still wants to have a “constructive dialogue” over its budget.
Italy has until November 13 to resubmit its budget plan.
