Rising revenue, prudent spendingThe growth in public revenue, which is outpacing expenditure (excluding interest payments), will enable Italy to gradually consolidate its primary surplus and contain the rise in public debt.
Public revenue will remain higher than expenditure excluding interest payments as part of fiscal consolidation efforts and compliance with European rules, despite pressures, notably from pension and defence spending.
Primary surpluses offset the impact of high interest ratesFollowing a rise in the debt-to-GDP ratio in 2024 and 2025, driven in particular by significant stock-flow adjustments linked to the ‘superbonus’ scheme, Italy’s public debt is expected to stabilise gradually.
The debt-to-GDP ratio is projected to reach 137% of GDP in 2026, before falling to 133.7% by the end of our forecast horizon (in 2032), driven by nominal growth and primary surpluses offsetting the interest burden, which will, however, increase from 2029 onwards.
