Overview: Since World War II the economy has changed from one based on agriculture into a ranking industrial economy, with approximately the same total and per capita output as France and the UK. The country is still divided into a developed industrial north, dominated by private companies, and an undeveloped agricultural south, dominated by large public enterprises. Services account for 48% of GDP, industry 35%, agriculture 4%, and public administration 13%. Most raw materials needed by industry and over 75% of energy requirements must be imported. After growing at an annual average rate of 3% in 1983-90, growth slowed to about 1% in 1991 and 1992. In the second half of 1992, Rome became unsettled by the prospect of not qualifying to participate in EC plans for economic and monetary union later in the decade; thus it finally began to address its huge fiscal imbalances. Thanks to the determination of Prime Minister AMATO, the government adopted a fairly stringent budget for 1993, abandoned its highly inflationary wage indexation system, and started to scale back its extremely generous social welfare programs, including pension and health care benefits. Monetary officials, who were forced to withdraw the lira from the European monetary system in September 1992 when it came under extreme pressure in currency markets, remain committed to bringing the currency back into the grid as soon as conditions warrant. For the 1990s, Italy faces the problems of refurbishing a tottering communications system, curbing pollution in major industrial centers, and adjusting to the new competitive forces accompanying the ongoing economic integration of the European Community.

National product: GDP - purchasing power equivalent - $1.012 trillion (1992)

National product real growth rate: 0.9% (1992)

National product per capita: $17,500 (1992)

Inflation rate (consumer prices): 5.4% (1992)

Unemployment rate: 11% (1992 est.)

Budget: revenues $447 billion; expenditures $581 billion, including capital expenditures of $46 billion (1992 est.)

External debt: $42 billion (September 1992)

Industrial production: growth rate -0.5% (1992 est.); accounts for almost 35% of GDP

Electricity: 58,000,000 kW capacity; 235,000 million kWh produced, 4,060 kWh per capita (1992)

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

Agriculture: accounts for about 4% of GDP and about 10% of the work force; self-sufficient in foods other than meat, dairy products, and cereals; principal crops - fruits, vegetables, grapes, potatoes, sugar beets, soybeans, grain, olives; fish catch of 525,000 metric tons in 1990

Illicit drugs: increasingly important gateway country for Latin American cocaine entering the European market

Economic aid: donor - ODA and OOF commitments (1970-89), $25.9 billion

Currency: 1 Italian lira (Lit)=100 centesimi

Exchange rates: Italian lire (Lit) per US$1 - 1,482.5 (January 1993), 1,232.4 (1992), 1,240.6 (1991), 1,198.1 (1990), 1,372.1 (1989), 1,301.6 (1988)

Fiscal year: calendar year