Italy

«The Economist», 12 febbraio 1938 pp. 16-17

An additional number of figures to illustrate economic activity has become available this year, and it is now possible to indicate Italy’s progress in the main branches during the last few years. In 1937 there was a marked recovery, and in many instances pre-depression levels were exceeded. The year was notable for an improvement in crops, except in vine cultivation, which still lagged behind 1935. Wheat, rice, hemp and cocoons are State monopolies, and the advance in wheat output was most marked.

INDUSTRY. – The Corporations Department has published indices of industrial production (1928=100).

The textile and building industries were the only ones which did not exceed the highest levels of production in 1928 and 1929, largely because armament activity is not seriously felt in these trades.

FOREIGN TRADE. – Owing to the new importance of the Empire, the figures of trade with the colonies are now separated from those of trade with the rest of the world:

The colonial trade consists mainly of supplies sent to military and civil corps operating in Oriental Africa. Among the items which covered the import surplus in the balance of payments the most important were tourists’ expenditure and the sale of State-owned foreign securities. Imports fell slightly, but their value increased by more than 90 per cent.; while exports increased by almost 25 per cent, in volume, but only 37.4 per cent, in value.

PRICES, COST OF LIVING AND WAGES. – The year’s movements in the index of wholesale prices and its components were as follows (1928=100):

After the alignment (devaluation by 41 per cent.) of the lira, wholesale price only increased by 25.3 per cent. Foodstuffs went up 22.3 per cent, in price, and the general cost of living rose by 17.6 per cent.; but, since wages per hour, the number of persons employed and the hours of work per man also increased, the average working family, working rather more strenuously, is probably better off than before devaluation.

MONEY MARKET AND STOCK EXCHANGE. – There was only very slight increase in bank deposits, and a very small transference of deposits from ordinary saving banks to other banks.

Average prices of 153 leading joint-stock companies’ variable dividend shares increased from 100 in 1932 to 104.1 in 1933, 118.9 in 1934,132.2 in 1935, 142.3 in 1936 and to a maximum of 183.3 in August, 1937. A decline to 167.5 in October then took place with a recovery to 174.8 in November. If we take as a basis prices for September, 1936, the month before the alignment of the lira, the index rose to 114.1 in December, 1936, and 128.9 in August, 1937, and then fell to 122.9 in November.

PUBLIC FINANCE. – On the basis of Budget statements by the Finance Minister, official papers and authorised communiques, the results of the last two fiscal years can be summed up as follows:

The difference between this total and the total deficits was easily raised by the Treasury by various means not yet published. After the revaluation of the gold reserves of the Bank of Italy, the results of which (1,649 million lire) were appropriated by the State, the gold reserve of the Bank of Italy stood in December, 1937, at 4,022 million lire, the same as in October, 1936.