Italy: the trade surplus, the only engine of the economy, is disappearing. What will drive us?
Istat communicates the latest data on Italian foreign trade, and they are not good at all, especially for the month of April.
The seasonally adjusted data, compared to March 2023, decreased by -1.7% for exports and increased by +5.3% for imports. Exports to EU countries decreased by -1.5% and decreased by -2.0% for non-EU countries. Imports increased for non-EU countries (+13.9%) and slightly decreased for EU countries (-0.6%).
In the last three months, seasonally adjusted data, compared to the previous three months, decreased both for exports (-2.2%) and for imports (-6.5%).
In April 2023, compared to the same month of the previous year, exports decreased by -5.4% and imports by -12.3%. This was essentially due to the partial solution of the energy crisis. Outgoing flows decreased by -5.7% for EU countries and -4.9% for third countries. Incoming flows decreased by -5.6% for the EU area and -19.4% for the non-EU area.
In April 2023, the trade balance recorded a surplus of +318 million euros (-921 million euros of deficit for EU countries and +1,239 million euros of surplus for non-EU countries). Excluding energy, the trade balance surplus reached +6,047 million euros.
Here are the export and trade balance graphs. First exports, which we see in the last year and in a ten-year perspective.
Now the trade balance, always on an annual and ten-year perspective
In April 2023, import prices decreased by 1.0% on a monthly basis (-0.3% for the Eurozone, -1.6% for the non-Eurozone). In the last three months, compared to the previous three months, import prices decreased by 5.6% (-0.5% for the eurozone, -10.1% for the non-eurozone).
Import prices, compared to the same month of the previous year, decreased by 6.2% in April 2023 (+1.3% for the euro area and -12.3% for the non-euro area). This decline, especially in exports from non-euro areas, is linked to energy factors.
End of a growth paradigm
The economic survival of Italy and the Euro area in recent years has been linked above all to large trade surpluses. In a system built to accentuate austerity and depress public spending and internal consumption, through a strong currency and tough budgetary discipline, growth was ensured by powerful extra-euro area trade surpluses, especially created by Italy and Germany, but which works for all other countries.
At least for us this paradigm is finished. The energy crisis, even if partially over, has led to a displacement of our industrial exports. The drop in production volumes then causes a further loss of competitiveness (remember Kaldor's second law on productivity) and therefore further displaces our productions, in a sort of vicious circle.
The cure would be a targeted stimulus of internal demand, to improve internal production volumes and therefore the productivity of the system, efficiency, etc. , that is, all those things they try to give you when they give the image of ugly, dirty and bad Italian. Obviously this is not possible, because we are in the Europe of the German austere traction. So all that remains is the rather unhappy, rather rather pissed off, decline.
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The article Italy: the trade surplus, the only engine of the economy, is disappearing. What will drive us? comes from Economic Scenarios .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/italia-se-ne-va-il-surplus-commerciale-unico-motore-delleconomia-cosa-ci-spingera/ on Sat, 17 Jun 2023 11:00:14 +0000.