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Three years into her premiership, Giorgia Meloni has defied expectations when she was elected by holding together one of Italy\u2019s most stable governments in recent memory.<\/p>\n
Over roughly the past decade, Italy has had six governments, meaning about one every 1.7 years on average \u2014 an extraordinary rate of turnover even by Italian standards.<\/p>\n
Yet while political calm has returned to Rome, the same cannot be said for Italy\u2019s sluggish economy.<\/p>\n
Growth forecasts continue to underwhelm, and waves of frustrated business leaders are pressing Meloni to move faster on reforms she promised, which pledge to bring Italy to the heights of more prosperous European economies.<\/p>\n
According to a June 2025 projection by ISTAT, GDP growth will be around 0.6% in 2025 and 0.8% in 2026.<\/p>\n
Political stability into economic momentum<\/p>\n
As Italy\u2019s economy grinds along with one of the weakest growth rates in Europe, pressure is mounting on Meloni to turn her government\u2019s political stability into tangible economic momentum. <\/p>\n
Business leaders who once praised her steady hand are now calling for speed and substance in reforming the country\u2019s overburdened tax, banking, and regulatory systems.<\/p>\n
For Joseph Gulino, managing partner at DRRT and a lawyer advising companies across Europe and the US, the stakes could not be higher. <\/p>\n
\u201cProviding incentives for businesses, streamlining process for starting and expanding businesses, and promoting the influx of talent or brain gain will go a long way to create growth and change common misconceptions about doing business in Italy,\u201d he told Euronews.<\/p>\n
The perception gap<\/p>\n
Italy\u2019s problem, Gulino suggests, is not only bureaucratic \u2014 it\u2019s psychological. <\/p>\n
Decades of red tape and policy inconsistency have left global investors wary. Even as Meloni\u2019s government trims administrative procedures and commissions new reviews of financial regulation (the Testo Unico della Finanza), the perception that Italy is a complex and slow place to do business persists.<\/p>\n
\u201cNot only tax credits but also removing administrative and bureaucratic burdens will make Italy more competitive \u2014 or will make it seem that way \u2014 and the perception is reality,\u201d Gulino said.<\/p>\n
A reputation for efficiency, he believes, can itself become a driver of economic renewal.<\/p>\n
Often described as Italy\u2019s \u201crulebook for financial markets\u201d, the Testo Unico della Finanza sets out how companies can raise capital, how banks and brokers operate, and what protections investors are guaranteed. <\/p>\n
In practice, it governs everything from stock listings and corporate transparency to penalties for insider trading \u2014 making it central to any effort to modernise Italy\u2019s financial system.<\/p>\n
Meloni\u2019s government has launched a review of the TUF to simplify listings and attract more firms to Italy\u2019s underdeveloped capital markets, where most companies still rely on bank lending rather than equity financing.<\/p>\n
Symbol vs. substance<\/p>\n
Meloni\u2019s much-touted tax reform is one area where expectations are high. The government has promised simplification and consistency, but business leaders are still waiting for results.<\/p>\n
The multi-year riforma fiscale empowered ministers to overhaul the country’s tax system in 2023 over a roughly two-year period by reshaping personal income tax brackets, revising corporate tax rules, streamlining VAT, and boosting a pro-growth framework.<\/p>\n
Gulino acknowledges that change is in progress but warns against overpromising immediate transformation. Many reforms remain partial or temporary, which is why business leaders say they are still waiting to see the full simplification take hold across the system.<\/p>\n
The ministries and representatives of Italian industry are now locked in a public debate about how exactly the tax reform should take place. <\/p>\n
According to Confindustria, Italy’s main business lobby, the reforms are “an important signal of dialogue, but there\u2019s still useful work to do on several points to clarify the substance of the proposals\u201d.<\/p>\n
Confindustria president Emanuele Orsini made the comments after presenting the group\u2019s simplification plan to the government in June.<\/p>\n
Orsini argued that the government needs to work with businesses to minimise the situations where the government is too eager to punish companies for alleged non-compliance.<\/p>\n
“Fines cannot be considered a structural part of revenue,” he continued. “Simplification, in fact, means helping businesses comply with regulations, moving beyond an approach that views errors, even formal ones, as a way to raise funds,” Orsini explained.<\/p>\n
Banking and the bigger picture<\/p>\n
Italy\u2019s corporate landscape tells a more complex story than growth data alone might suggest. <\/p>\n
The country\u2019s major industrial players, such as Pirelli tires or truckmaker Iveco, remain coveted by global buyers, although its banking sector continues to struggle with scale and consolidation. Gulino points to this divide as emblematic of Italy\u2019s uneven economic performance.<\/p>\n
\u201cThe numbers here might not tell the whole story,\u201d he explained. \u201cWe know that through mergers and acquisitions, some large Italian companies, especially in the fashion and automobile sectors, have been large and attractive targets of foreign purchasers \u2014 not just to gain a foothold in Italy and access to the market, but also for the intangibles, such as the Made in Italy label, that make products valuable.\u201d<\/p>\n
Yet where Italian industry is an export success, its banks have lagged in building scale.<\/p>\n
\u201cLook at the dominance in the banking sector and attempts \u2014 thus far less than successful \u2014 for Italian banks to create Europe-wide banks, such as with UniCredit and its increasing ownership of Commerzbank,\u201d Gulino said.<\/p>\n
Italian banking giant UniCredit has been building a large stake in Germany’s Commerzbank in an attempt to create a cross-border merger, receiving regulatory clearances in 2025 to go as high as 29.9%.<\/p>\n
But no merger is happening yet, with Commerzbank\u2019s management and leaders in Berlin remaining hostile to a takeover, and unions worried about job cuts.<\/p>\n
Meanwhile, UniCredit\u2019s all-share bid for rival Italian bank Banco BPM collapsed in July after Rome\u2019s \u201cgolden power\u201d conditions and repeated regulator suspensions spooked investors, resulting in a withdrawal of the offer. A golden power condition is a binding requirement the Italian government can attach to a deal involving strategic sectors.<\/p>\n
The structural drag<\/p>\n
Despite the potential of Meloni’s reforms, there are long-running structural bottlenecks holding Italy back, such as a business base dominated by under-scale firms, stubbornly weak productivity, notoriously difficult bureaucracy, and slow courts.<\/p>\n
Shallow capital markets also make it harder to fund growth, while input costs for industry make continuous expansion more difficult.<\/p>\n
All these frictions put a cap on Italian competitiveness and make it more challenging to translate tax tweaks or one-off incentives into sustained growth.<\/p>\n
\u201cThis is a bigger structural problem in the Italian economy that will take longer to resolve, as it is often a drag on competitiveness,\u201d Gulino said. \u201cThere is also the issue of debt limits as part of the eurozone and maintaining its improving credit rating while reducing the spread in borrowing rates compared to other eurozone economies.\u201d<\/p>\n
Italy\u2019s high public-debt load, which sits at around 137.9% according to Eurostat, is the second-highest in the EU after Greece at 152.5%, far above the EU average.<\/p>\n
Rome needs to therefore maintain fiscal discipline to protect its credit rating and keep bond spreads in check, which limits room for big stimulus packages or tax breaks.<\/p>\n
That balancing act \u2014 between fiscal discipline and growth stimulus \u2014 is likely to define Meloni\u2019s next two years in office. With elections due in 2027, she faces an increasingly narrow window to deliver visible progress.<\/p>\n
A moment to define the narrative<\/p>\n
Earlier this year, Italy’s deputy economy minister Maurizio Leo said: “piece by piece, we are implementing a landmark reform that will position Italy to compete with the world’s leading economies.”<\/p>\n
For Gulino and many of Italy\u2019s business leaders, the reform question now extends beyond technical details to the story Italy tells about itself. <\/p>\n
As well as concrete reforms, a credible narrative of openness, innovation, and predictability is important when attracting investment to Italy.<\/p>\n
\u201cPerception is reality,\u201d Gulino said. \u201cIf Italy can project that it is a country where business can start, grow, and thrive easily, that story alone could start rewriting its economic future.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"ADVERTISEMENT Three years into her premiership, Giorgia Meloni has defied expectations when she was elected by holding together…\n","protected":false},"author":2,"featured_media":488035,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3090],"tags":[51,5286,1700,2440,63010,157554,16,15],"class_list":{"0":"post-488034","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-economy","8":"tag-business","9":"tag-economic-growth","10":"tag-economy","11":"tag-giorgia-meloni","12":"tag-italian-economy","13":"tag-made-in-italy","14":"tag-uk","15":"tag-united-kingdom"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@uk\/115349281177840137","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/488034","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/comments?post=488034"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/posts\/488034\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media\/488035"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/media?parent=488034"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/categories?post=488034"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/uk\/wp-json\/wp\/v2\/tags?post=488034"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}