Feb. 14 (Bloomberg) -- Italy, suffering from a lack of competitiveness and high public debt, will be further reviewed under the European Union’s new rules on economic governance, the European Commission said.
The commission, the EU’s Brussels-based executive arm, singled out 11 other EU economies in need of review in its first annual Alert Mechanism Report, released today. The report measured countries based on 10 macroeconomic indicators, including debt and asset bubbles.
Italy has experienced “significant deterioration in competitiveness since the mid-1990s, which is also seen through the persistent losses of export-market shares,” the commission said in a statement accompanying the report. “While private-sector indebtedness is relatively contained, the level of public debt is a concern, especially given the weak growth performance and structural weaknesses.”
The commission said in the report that “weak productivity developments is the main explanatory factory” for the loss of Italian competitiveness.
EU Econommic and Monetary Affairs Commissioner Olli Rehn, presenting the report in Strasbourg, France, said the debt crisis shows that macroeconomic imbalances pose “serious risks.” The other 11 economies that need to be investigated are Belgium, Bulgaria, Cyprus, Denmark, Finland, France, Hungary, Slovenia, Spain, Sweden and the U.K., according to the statement.
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