The OECD on Monday called on Italy to introduce tax and public spending reforms, saying that the nation's debt-to-GDP ratio is set to rise without policy changes.
"Public debt, at about 140% of GDP, is the third highest in the OECD," the OECD said in its latest Economic Survey of Italy.
"Public spending on ageing-related and debt servicing costs as a share of GDP is expected to increase by about 4.5 percentage points between 2023 and 2040. "Tax and spending reforms are needed to help put debt on a more prudent path.
Steady fiscal consolidation over several years is the key priority for fiscal policy to durably lower public debt, starting from 2025.
"Growth in spending needs to be contained, but at the same time public investment should be protected to minimize negative side-effects on growth".
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