Italy announces a 17 billion euro aid package to tackle drought and inflation

Rome 5 August : Italian Prime Minister Mario Draghi announced an aid package estimated to be worth 17 billion euros, to fight the rising dryness and inflation.

He has agreed to remain as the head of government in an interim role until the new government is formed following an election scheduled for the 25th of September.In the spring of this year, Italy already approved the 35 billion euro economic aid.Together, the two measures amount to greater than 2 percent of Italys gross domestic product, Draghi stated.He declared that the order was of "extraordinary dimensions" and that his goal was to "give the next administration the chance to achieve the success of all targets" in relation to the EUs over 200 billion euros in coronavirus-related loans as well as grants.

According to Draghis statement one of the measures to be financed through the new aid package is "the extended period of charges and other steps relating to fuel costs and the re-evaluation of pensions and tax cuts" in addition to those that were financed in the first round of aid this year.The Prime Minister announced there will be "measures in support of farmers against drought" and funding for targeted regional and local initiatives, as well as a 200 euro bonus for self-employed employees.

Italy has been shattered by rising prices caused by the war between Russia and Ukraine that has driven the global price of fuel higher and resulted in food shortages as well as disruptions to supply chains.At the close of July the prices were 7.9 percent higher than they were a year earlier and in June, the year-on year price increase was 8 percent which was the most in Italy since the introduction of the euro currency.Italy has also been afflicted by unusually dry and hot temperatures this summer.

The association of farmers Coldiretti stated that the countrys agricultural output for this year will be reduced by around 1/3, with some sectors seeing reductions of more than double that amount.On the 19th of June, 19 cities, including Rome, Milan, and Turin will be placed on alert due to the high temperatures.

However, Draghi stated that these issues will be reduced through the governments actions and he predicted that, despite the difficulties, Italys economy is expected to expand faster than those of France as well as Germany which are the two largest economies in the euro zone.