EU warns Italy to address debt problems amid 'weak economic outlook'

The European Union has said it is concerned about Italy's debt and is warning the government in Rome to shore up its public finances.

EU warns Italy to address debt problems amid 'weak economic outlook'

The European Union has said it is concerned about Italy's debt and is warning the government in Rome to shore up its public finances.

European Commission Vice-President Valdis Dombrovskis said that Italy's "public debt ratio is not expected to decline in coming years due to the weak economic outlook and government fiscal plans".

Mr Dombrovskis said "reform momentum has stalled" and noted "some reversals", particularly on pensions.

Italy expects its debt-to-GDP ratio to rise to 131.7%, but the EU's executive commission warned it might be higher "due to the weak macroeconomic outlook, underachievement of privatisation targets and a worsening primary balance".

Growth is unlikely to exceed 0.2% this year, according to the commission, which said it will "closely monitor developments" and potentially take action against Italy in the spring.

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