Italy is undergoing a major economic crisis, and many in the country are blaming France and Germany for the economic problems Italy is facing.
The issue is Italy’s level of debt and their inability to print currency, which is caused by their inclusion in the European Union. France and Germany are the biggest proponents of a single currency for the EU with countries like Italy and Greece with smaller economies who are beholden to the larger members of the EU left without financial leverage to cope with their debt.
The problems the Italy is facing are very comparable to the ones that hit Greece during their own economic crisis. Insufficient tax revenues to offset spending and a stake economy to boot. Tax revenues in Italy are significantly lower due to massive financial tax evasion in the country.
These economic problems are posing risks for the world economy at large. Financial crisis in one country impact others in unknown and unpredicted ways. A loss Of confidenc in Italy can spell financial problems in other countries and raise the cost of borrowing. Further, it can put pressure on some of the other minor countries and Their economies.
The economic crisis in Italy has a ready cause problems for their political reality. Emily is an important component of the EU, which is still the largest economy in the world. How this will impact the larger global economy remains a major risk for financial markets and for international companies in the global economy.