The Bank of Italy presented its annual report “The economy of Calabria” in Catanzaro, finding that the region’s economy grew only modestly in 2024. Based on the Bank of Italy’s ITER indicator, output rose by 0.8% (1.3% in 2023), broadly in line with Italy, as weak consumption weighed while investment, especially public investment, continued to contribute positively; the report notes that the outlook could be affected by geopolitical uncertainty and rising international trade tensions. Growth in services continued but at a slower pace, and construction activity lost momentum as tax incentives for building renovations were scaled back, although public works remained supportive; regional industrial production stabilised after declines in the previous two years. Business profitability weakened, liquidity remained high with a strong preference for current account deposits, and lending dynamics were weak, particularly for small firms, reflecting still-muted demand and cautious supply despite falling interest rates. Employment rose only slightly, with self-employment down and employee jobs still increasing (driven by permanent contracts), while youth employment and labour market participation both declined; household income increased in nominal and real terms as inflation eased, but consumption remained subdued and supported by extensive use of consumer credit, while mortgage demand picked up after a sharp fall in 2023. Bank loans to the non-financial private sector returned to growth but at modest rates; credit deterioration was broadly stable for households and rose further for firms, while remaining historically low in both segments. Deposits expanded again, mainly among households, and the market value of securities held in custody increased but less than in the previous year, alongside a weaker expansion in government bonds and corporate bonds. Local government spending rose again, led by current spending including healthcare and services with defined essential performance levels, while investment spending stayed at the elevated level reached in 2023 on the back of Italy’s National Recovery and Resilience Plan; cohesion-policy support was lower after the end of the 2014–20 cycle and spending under the 2021–27 cycle remained limited following the STEP remodulation. The report also points to Calabria’s persistent gap versus the national average, noting that activity remains well below 2007 levels, driven largely by demographic decline, with low innovation and research spending and a potential role for the university system and the growing Cosenza IT hub in supporting adoption of advanced technologies and artificial intelligence.
Bank of Italy 2025-06-12
Bank of Italy presents annual report on Calabria’s 2024 economy with growth slowing to 0.8%
The Bank of Italy's annual report on Calabria indicates modest economic growth of 0.8% in 2024, with weak consumption offset by positive public investment. Employment rose slightly, but youth employment and labour market participation declined, while household income increased as inflation eased. Credit to the non-financial private sector grew modestly, with stable credit deterioration for households and a rise for firms, and local government spending increased, driven by healthcare and essential services.