OECD tells Italy not to backtrack on reform

Monti's moves will boost GDP by 4% over next decade, says Gurria

OECD tells Italy not to backtrack on reform

(ANSA) - Rome, September 24 - The Organisation for Economic Co-operation and Development (OECD) on Monday called for Italy not to backtrack on the reforms Premier Mario Monti has launched when the term of his emergency government ends next year. "Say no to the temptation to go back and dismantle the reforms carried out," OECD Secretary General Angel Gurria told a conference that Monti also took part in. Monti's government has introduced a series of reforms, including liberalisation in many sectors and labour-market measures that will make it easier for firms to dismiss workers, a move designed to boost productivity and make companies more inclined to hire people. Gurria said these moves would generate big rewards. "The structural reforms launched by the Monti government will make it possible for Italy to increase GDP by 4% over the next 10 years, an increase of 0.4% a year solely on the basis of the reforms announced so far," said Gurria. The OECD chief agreed with Monti's assessment that Italy is now part of the solution to the eurozone debt crisis, rather than a source of problems. "The future of Italy is not the only thing at stake, the construction of Europe is," he said. "Italy is making a decisive contribution to this". Gurria described Monti as the "right man at the right moment" for "overcoming obstacles that have conditioned Italy's growth for some time" by taking "unprecedented courageous decisions". But the OECD also stressed that many challenges, such as reducing massive youth unemployment and boosting productivity, lie ahead. "Youth unemployment in Italy is three times higher than the (OECD) average of 11%, at over 35%, which is not just a number," Gurria said. "This represents broken dreams, the loss of confidence and sometimes desperation". His comments came as a new OECD report said that the rate of growth of Italian productivity is the lowest in the OECD. "Italy must face a series of challenges in terms of competitiveness. Indeed, greater competitiveness is a key element for the consolidation of growth," the report said.

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