The Group operates in the construction and concessions sectors in Italy.
Macroeconomic scenario
Italy’s development prospects have become more positive and the country has resumed growth. The OECD ranked Italy as one of the Eurozone economies with the highest growth rates of the year, thanks to the improved labour market conditions and the related upturn in domestic consumption. The 2015 budget deficit decreased to 2.6% of GDP and is expected to continue this trend, mainly as a result of the economy’s cyclical recovery and the lower interest rates.
GDP is forecast to grow by 1% in 2016 and 1.4% in 2017, driven mainly by household consumption. The rise in employment has temporarily slowed down while domestic spending is boosted by the increase in consumption. Investments have picked up, thus also assisting internal demand despite the lending constraints put in place by banks hindering a faster recovery.
The government has reiterated its commitment to gradual tax consolidation and a structural reform programme. In order to create the fiscal space needed to increase public investments and avoid increasing indirect taxes, as planned for 2017, the government intends to resort to the budget flexibility clause provided for by the EU while concurrently containing public spending.
The collapse in investments caused by the economic crisis, which triggered a long-term deceleration of the economy, was followed by an upturn in the production of investment goods. Together with the low recorded by the construction sector, this could herald a possible reversal in the investments cycle, although the scarce bank funding available and uncertainty about future demand continue to hold back this positive trend.
The outlook for growth is improving and Italy has continued its exit from the second recession which started in the summer of 2011 and continued until autumn 2014, just after the shorter but more intense crisis of 2008/2009. The speed of its recovery is strongly influenced by the international economic climate. The structural reform programme’s positive status is assisting consolidation of long-term forecasts even though there is much ground to cover to improve the country’s productivity and efficiency. Any delays in implementing its ambitious public investment programme will slow down its recovery. In addition, Brexit and renewed volatility in the Eurozone’s financial markets may propagate risks and increase the cost of borrowing, which would increase the tax burden.
Construction
High speed/capacity Milan-Railway Project
High speed/capacity Verona-Padua Railway Project
Concessions