Italy: Recession Causing ‘War-Like’ Economic Damage

Italy is suffering a ”serious recession” causing economic damage that is similar to a war, according to a report by the country’s biggest business association.

“Up until now the damage caused by the crisis is equivalent to that of a conflict,” the Rome-based Confindustria said Thursday in a report. Most of the damage has hit “the most vital and precious part of the Italian economic system.”

“The rise and the level of public debt is similar in all the advanced economies to that which is present at the end of bellicose global clashes,” the report said.

The powerful Confindustria said it expects the Italian economy to shrink 2.4 percent this year and 0.3 percent in 2013. That compares with the group’s December forecast of a 1.6 percent decline in 2012, rising 0.6 percent in 2013.

Italy’s emergency un-elected government led by prime minister Mario Monti has raised taxes, implemented pension reform and made it easier for businesses to fire their workers, all in an effort to lower its 1.95 trillion euros in debt and spark economic growth.

Critics say the government’s initiatives is sapping energy from the economy by taking money from consumers’ pockets.

Italy’s joblessness is at more than 10 percent – a 12-year-high – but will likely continue to rise to 11.8 percent next year, the Confindustria report said.