The 1970s were a period of economic, political turmoil and social unrest in Italy. Unemployment rose sharply, especially among the young. By 1977 there were one million unemployed people under age 24. Inflation continued, aggravated by the increases in the price of oil in 1973 and 1979. The budget deficit became permanent and intractable, averaging about 10 percent of the gross domestic product (GDP), higher than any other industrial country. The lira fell steadily, from 560 lira to the U.S. dollar in 1973 to 1,400 lira in 1982. The economic recession went on into the mid-1980s until a reduce of public costs and spendings, tighter budgets and deficits, a steady economic growth, and a lowered inflation rate meant that by the recovery plan of 1983, Italy left recession. This plan led to an increasing GDP growth, lower inflation, and increased industrial/agricultural/commercial produce, exports and output, yet made the unemployment rate rise. A decrease in energy prices and lowered value of the dollar led to foreign exchange being liberalised and the economy to re-grow rapidly. As a matter of fact, in 1987, Italy had a period when it surpassed the British economy (an event known as il sorpasso), becoming the fifth in the world. On 15 May 1991 Italy became for a while the fourth worldwide economic power, overcoming France, with a GDP of US$ 1.268 trillion, compared to France's GDP of US$ 1.209 trillion and Britain's of US$ 1.087 trillion. Despite this, however, Italy's alleged (according to the Economist's) 1987 GDP growth of a phenomenal 18%, it was shortly re-overtaken by both France and the United Kingdom during the 1990s, when Italy's economic growth was particularly stagnant, with an average of 1.23% compared to an EU average of 2.28%.
Rate and comment
