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Ministry of Economy and FinanceTHE UNDERSECRETARY VEGAS TO ALESINA: MIGHT THIS BE A DéJà VU?

Press Release N° 40 of 03/11/2009

At a meeting held today, Professor Alesina, in recognising that we are undergoing what is: �perhaps the worst crisis since the war', stated that great works are not really a priority for our country, while smaller-scale and closely scrutinised intervention would be required along with speeding up payments of the public administration.

The undersecretary Vegas observed whether this might not be a repeat of what Alberto Alesina referred to as: �an adjustment of the kind we've seen many times before', reported in La Stampa on 20 August 2007, or echo what he stated the same year in Il Sole 24 of 7 September: �so far nothing catastrophic has occurred, nor is it going to, in my opinion'.

It is certainly not a critical situation on the scale of the 1929 crisis, but it is undeniably an economic impasse.

Re-establishing a climate of confidence is crucial to resolving this situation, though not sufficient. And, in order to obtain this result, we need facts. First and foremost, support to the lending sector, of the kind the Government has given, along with protecting the income of those who risk losing their jobs, as well as focusing on sustaining demand which can hardly be obtained - under present conditions - if instruments are not based on modern infrastructures. It is not just a question of digging holes and filling them, but offering a mechanism whereby internal investments can be re-launched so that Italy can become a more competitive country as soon as this crisis is over.

Rome 03/11/2009

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