The country is also well known for its influential and innovative business/economic sector, industrious and competitive agricultural sector and manufacturers of creatively designed, high-quality products.
Italy’s economic freedom score is 65.4, making its economy the 57th freest in the 2022 Index. Italy is ranked 33rd among 45 countries in the Europe region, and its overall score is below the regional average but above the world average, by the 2022 index of economic freedom.
The Italian economy slowed from 2017 through to 2019, contracted in 2020, and resumed growth in 2021. A five-year trend of overall improvement of economic freedom has continued. Led by notable jumps in scores for rule of law (property rights, judicial effectiveness, and government integrity), Italy has posted an overall 2.9-point gain in economic freedom since 2017 and has climbed into the top half of the Moderately Free category. Monetary freedom, trade freedom and investment freedom are strong, but the economy remains heavily burdened by government spending.
As of December 1, 2021, 133,931 deaths have been attributed to the pandemic in Italy, and the government’s response to the crisis ranked 16th among the countries included in this Index in terms of its stringency. The economy contracted by 8.9 percent in 2020, according to the 2022 index of economic freedom.
Italy has a highly developed market economy.
Italy has a highly developed market economy. It is the third-largest national economy in the European Union, the ninth-largest in the world by nominal GDP, and the 13th-largest by GDP (PPP). Italy is a founding member of the European Union, the Eurozone, the OECD, the G7 and the G20; it is the tenth-largest exporter in the world, with $632 billion exported in 2019. Its closest trade ties are with the other countries of the European Union, with whom it conducts about 59% of its total trade. The largest trading partners, in order of market share in exports, are Germany (12.5%), France (10.3%), the United States (9%), Spain (5.2%), the United Kingdom (5.2%) and Switzerland (4.6%).
In the post-World War II period, Italy saw a transformation from an agriculture-based economy which had been severely affected by the consequences of the World Wars, into one of the world’s most advanced nations, and a leading country in world trade and exports. According to the Human Development Index, the country enjoys a very high standard of living. According to The Economist, Italy has the world’s 8th highest quality of life. Italy owns the world’s third-largest gold reserves and is the third-largest net contributor to the budget of the European Union. Furthermore, while the country’s private wealth is one of the largest in the world. In terms of private wealth, Italy ranks second, after Hong Kong, in private wealth to GDP ratio.
Italy has a strong cooperative sector, with the largest share of the population employed by a cooperative in the EU.
Italy is the world’s sixth-largest manufacturing country, characterised by a smaller number of global multinational corporations than other economies of comparable size and many dynamic small and medium-sized enterprises, notoriously clustered in several industrial districts, which are the backbone of the Italian industry. Italy is a large manufacturer and exporter of a significant variety of products. Its products include machinery, vehicles, pharmaceuticals, furniture, food and clothing. Italy has therefore a significant trade surplus. The country is also well known for its influential and innovative business economic sector, an industrious and competitive agricultural sector (Italy is the world’s largest wine producer) and manufacturers of creatively designed, high-quality products: including automobiles, ships, home appliances, and designer clothing. Italy is the largest hub for luxury goods in Europe and the third luxury hub globally. The Italian manufacturing sector is capable of facing competition from China and other emerging Asian economies based on lower labour costs, with higher quality products. Italy has a strong cooperative sector, with the largest share of the population (4.5%) employed by a cooperative in the EU.