Italy’s ‘grey economy’ worth a third of GDP: study

Rome – Italy’s grey economy expanded in 2011 to an estimated 540 billion euros ($717 billion), or some 35% of the country’s official gross domestic product (GDP), a new study showed Thursday, March 29.

The report by Italian research group Eurispes said that the figure for 2010 for a vast underground economy, ranging from mafia-owned businesses to illegal apartment rentals, had been roughly 529 billion euros.

It said it had made its calculations based on tax police investigations, which have been stepped up since Prime Minister Mario Monti took power last year promising to crack down on illegality and to boost public coffers.

Eurispes also estimated around 35% of registered employees, or around six million people, “are now forced to work a second job to make ends meet.”

It said 500,000 households were having trouble making mortgage payments and that consumer credit had risen 100 percent between 2002 and 2011.

“There is an unfair competition in Italy between people who respect the law and people who don’t,” Maurizio Zipponi, a lawmaker from the anti-corruption Italy of Values party, said in a statement after the report’s release.

He called on Monti, a former European competition commissioner who famously took on Microsoft and General Electric, “to intervene with a heavy and determined hand against evasion, corruption and unfair competition.

“This is the real reason behind the lack of foreign investment,” he said. – Agence France-Presse