The global economy is better than we expected; the economy has held up.

“The global economy is clearly better than we expected last year,” said the Governor of the Bank of Italy. Fabio Panetta, speaking at the ABI executive committee meeting underway in Milan. “In fact, the global economy has held up: we haven’t seen any recessions or slowdowns anywhere in the world.”

“I expect that, in the long run, tensions will also arise over control of water resources,” said the Governor of the Bank of Italy. Panetta added that water “is increasingly becoming a scarce and important resource, both for electricity and for the operation of artificial engineering and ecological infrastructure.”

“Banks are generally more profitable and more vigilant. We’ve witnessed a series of shocks without seeing the resurgence of non-performing loans; the banking sector is in better shape,” Panetta stated. Regarding the banking sector, he said, “it’s useful to simplify where there are redundancies, burdens due solely to regulatory complications. The debate on simplification has grown and spread, and the Eurosystem has fully embraced this idea of simplification.” Panetta added that the ECB’s proposal and the Supervisory Authority to the European Commission “is a debate that has begun, and I believe it must continue.”

“In a world where technology is a key variable for development, innovation is another raw material, and it’s also something that can’t be found underground. We must invest in knowledge,” said Panetta. The governor emphasized that Italy, like all other countries, “must equip its young people with a wealth of knowledge. Our spending on education is lower than in other countries; we’re not far off, but we need to start.”

“When sanctions were imposed on Russia for the attack on Ukraine, the financial sanctions were effective, while the real ones were less effective,” Panetta said. “When the United States and Europe were moving in a highly coordinated manner, these two areas controlled almost 90 percent of the world’s technological and financial infrastructure. Sanctions on the real economy didn’t work as well,” he concluded.

The global economy is better than we expected; the economy has held up.

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