raw materials needed
by industry and more than 75% of energy requirements are imported.
Over the past decade, Italy has pursued a tight fiscal policy in
order to meet the requirements of the Economic and Monetary Unions
and has benefited from lower interest and inflation rates. The
current government has enacted numerous short-term reforms aimed at
improving competitiveness and long-term growth. Italy has moved
slowly, however, on implementing needed structural reforms, such as
lightening the high tax burden and overhauling Italy's rigid labor
market and over-generous pension system, because of the current
economic slowdown and opposition from labor unions. But the
leadership faces a severe economic constraint: the budget deficit
has breached the 3% EU ceiling. The economy experienced low growth
in 2006, and unemployment remained at a high level.

GDP (purchasing power parity):
$1.727 trillion (2006 est.)

GDP (official exchange rate):
$1.78 trillion (2006 est.)

GDP - real growth rate:
1.6% (2006 est.)

GDP - per capita (PPP):
$29,700 (2006 est.)

GDP - composition by sector:
agriculture: 2%
industry: 29.1%
services: 69% (2006 est.)

Labor force:
24.63 million (2006 est.)

Labor force - by occupation:
agriculture: 5%
industry: 32%
services: 63% (2001)

Unemployment rate:
7% (2006 est.)

Population below poverty line:
NA%

Household income or consumption by percentage share:
lowest 10%: 2.1%
highest 10%: 26.6% (2000)

Distribution of family income - Gini index:
36 (2000)

Inflation rate (consumer prices):
2.3% (2006 est.)

Investment (gross fixed):
20.8% of GDP (2006 est.)

Budget:
revenues: $832.9 billion
expenditures: $925 billion; including capital expenditures of $NA
(2006 est.)

Public debt:
107.8% of GDP (2006 est.)

Agriculture - products:
fruits, vegetables, grapes, potatoes, sugar beets, soybeans, grain,
olives; beef, dairy products; fish

Industries:
tourism, machinery, iron and steel, chemicals, food processing,
textiles, motor vehicles, clothing, footwear, ceramics

Industrial production growth rate:
1.5% (2006 est.)

Electricity - production:
277.6 billion kWh (2004)

Electricity - production by source:
fossil fuel: 78.6%
hydro: 18.4%
nuclear: 0%
other: 3% (2001)

Electricity - consumption:
303.8 billion kWh (2004)

Electricity - exports:
800 million kWh (2004)