Italy has a diversified industrial economy, which is divided into a developed industrial north, dominated by private companies, and a less-developed, welfare-dependent, agricultural south, with high unemployment. The Italian economy is driven in large part by the manufacture of high-quality consumer goods produced by small and medium-sized enterprises, many of them family owned. Italy also has a sizable underground economy, which by some estimates accounts for as much as 17% of GDP. These activities are most common within the agriculture, construction, and service sectors. Italy is the third-largest economy in the euro-zone, but exceptionally high public debt burdens and structural impediments to growth have rendered it vulnerable to scrutiny by financial markets. Public debt has increased steadily since 2007, reaching 120% of GDP in 2011, and borrowing costs on sovereign government debt have risen to record levels. During the second half of 2011 the government passed a series of three austerity packages to balance its budget by 2013 and decrease its public debt burden. These measures included a hike in the value-added tax, pension reforms, and cuts to public administration. The government also faces pressure from investors and European partners to address Italy's long-standing structural impediments to growth, such as an inflexible labor market and widespread tax evasion. The international financial crisis worsened conditions in Italy''s labor market, with unemployment rising from 6.2% in 2007 to 8.4% in 2011, but in the longer-term Italy''s low fertility rate and quota-driven immigration policies will increasingly strain its economy. The euro-zone crisis along with Italian austerity measures have reduced exports and domestic demand, slowing Italy''s recovery. Italy''s GDP is still 5% below its 2007 pre-crisis level.

Italy reports its data on public debt according to guidelines set out in the Maastricht Treaty; general government gross debt is defined in the Maastricht Treaty as consolidated general government gross debt at nominal value, outstanding at the end of the year, in the following categories of government liabilities (as defined in ESA95): currency and deposits (AF.2), securities other than shares excluding financial derivatives (AF.3, excluding AF.34), and loans (AF.4); the general government sector comprises the central government, state government, local government and social security funds

This is the European Central Bank's rate on the marginal lending facility, which offers overnight credit to banks in the euro area

$1.147 trillion (31 December 2011 est.)

$1.205 trillion (31 December 2010 est.)

See entry for the European Union for money supply in the euro area; the European Central Bank (ECB) controls monetary policy for the 17 members of the Economic and Monetary Union (EMU); individual members of the EMU do not control the quantity of money circulating within their own borders

$2.269 trillion (31 December 2011 est.)

$2.065 trillion (31 December 2010 est.)

$3.469 trillion (31 December 2011 est.)

$3.221 trillion (31 December 2010 est.)

$431.5 billion (31 December 2011)

$318.1 billion (31 December 2010)

$317.3 billion (31 December 2009)

Fruits, vegetables, grapes, potatoes, sugar beets, soybeans, grain, olives; beef, dairy products; fish

Tourism, machinery, iron and steel, chemicals, food processing, textiles, motor vehicles, clothing, footwear, ceramics

1.528 million bbl/day (2010 est.)

1.8 million bbl/day (2009 est.)

476.5 million bbl (1 January 2011 est.)

63.57 billion cu m (1 January 2011 est.)

Engineering products, textiles and clothing, production machinery, motor vehicles, transport equipment, chemicals; food, beverages and tobacco; minerals, and nonferrous metals

Germany 13.3%, France 11.8%, US 5.9%, Spain 5.4%, Switzerland 5.4%, UK 4.7% (2011)

Engineering products, chemicals, transport equipment, energy products, minerals and nonferrous metals, textiles and clothing; food, beverages, and tobacco

Germany 16.5%, France 8.9%, China 7.7%, Netherlands 5.5%, Spain 4.7% (2011)

$173.3 billion (31 December 2011 est.)

$158.9 billion (31 December 2010 est.)

$2.684 trillion (30 June 2011 est.)

$2.223 trillion (30 June 2010 est.)

$365.5 billion (31 December 2011 est.)

$332 billion (31 December 2010 est.)

$552.8 billion (31 December 2011 est.)

$487.6 billion (31 December 2010 est.)