Italy Argumentative Essay

This essay has a total of 2597 words and 12 pages.

Italy

INTRODUCTION
Italy is largely homogeneous linguistically and religiously but is diverse culturally,
economically, and politically. Italy has the fifth-highest population density in
Europe--about 200 persons per square kilometer (490/sq. mi.). Minority groups are small,
the largest being the German-speaking people of Bolzano Province and the Slovenes around
Trieste. Other groups comprise small communities of Albanian, Greek, Ladino, and French
origin. Although Roman Catholicism is the majority religion--85% of native-born citizens
are nominally Catholic--all religious faiths are provided equal freedom before the law by
the constitution.

FOREIGN RELATIONS
Italy was a founding member of the European Community--now the European Union (EU). Italy
was admitted to the United Nations in 1955 and is a member and strong supporter of the
North Atlantic Treaty Organization (NATO), the Organization for Economic Cooperation and
Development (OECD), the General Agreement on Tariffs and Trade/World Trade Organization
(GATT/WTO), the Organization for Security and Cooperation in Europe (OSCE), the Western
European Union (WEU), and the Council of Europe. It chaired the CSCE and the G-7 in 1994
and the EU in 1996.

Italy firmly supports the United Nations and its international security activities. Italy
actively participated in and deployed troops in support of UN peacekeeping missions in
Somalia, Mozambique, and Cambodia and provides critical support for NATO and UN operations
in Bosnia, Kosovo, and Albania.

The Italian Government seeks to obtain consensus with other European countries on various
defense and security issues within the WEU as well as NATO. European integration and the
development of common defense and security policies will continue to be of primary
interest to Italy.

U.S.-ITALY RELATIONS
The United States enjoys warm and friendly relations with Italy. The two are NATO allies
and cooperate in the United Nations; in various regional organizations; and bilaterally
for peace, prosperity, and defense. Italy has worked closely with the United States and
others on such issues as NATO and UN operations in Bosnia and Kosovo; sanctions against
the former Yugoslavia; assistance to Russia and the New Independent States (NIS); Middle
East peace process multilateral talks; Somalia and Mozambique peacekeeping; and combating
drug trafficking, trafficking in women and children, and terrorism.

Under longstanding bilateral agreements flowing from NATO membership, Italy hosts
important U.S. military forces at Vincenza and Livorno (Army); Aviano (Air Force); and
Sigonella, Gaeta, and Naples--home port for the U.S. Navy Sixth Fleet. The United States
has about 17,000 military personnel stationed in Italy. Italy hosts the NATO War College
in Rome.

Italy remains a strong and active transatlantic partner which, along with the United
States, has sought to foster democratic ideals and international cooperation in areas of
strife and civil conflict. Toward this end, the Italian Government has cooperated with the
U.S. in the formulation of defense, security, and peacekeeping policies.

ECONOMY
The Italian economy has changed dramatically since the end of World War II. From an
agriculturally based economy, it has developed into an industrial state ranked as the
world's fifth-largest industrial economy. Italy belongs to the Group of Eight (G-8)
industrialized nations; it is a member of the European Union and the OECD.

Italy has few natural resources. With much of the land unsuited for farming, it is a net
food importer. There are no substantial deposits of iron, coal, or oil. Proven natural gas
reserves, mainly in the Po Valley and offshore Adriatic, have grown in recent years and
constitute the country's most important mineral resource. Most raw materials needed for
manufacturing and more than 80% of the country's energy sources are imported. Italy's
economic strength is in the processing and the manufacturing of goods, primarily in small
and medium-sized family-owned firms. Its major industries are precision machinery, motor
vehicles, chemicals, pharmaceuticals, electric goods, and fashion and clothing.

Italy is in the midst of a slow economic recovery but lags behind most of its west
European neighbors. Italy's economy accelerated from anemic 0.7% growth in 1996 to 1.4% in
1999, still one of the lowest growth rates among industrialized economies. Domestic demand
and exports were the dominant factors in GDP growth. Most economic forecasters expect GDP
growth to increase to around 2.8% in 2000.

While exports declined during 1999, imports grew, resulting in a trade surplus of $14
billion in 1999, down from $27 billion in 1998, and $47.1 billion in 1997. Italy has
continued to build foreign exchange reserves to $80 billion in 1998, a record high.

On inflation, Italy is now firmly within norms specified for Economic and Monetary Union
(EMU), a major achievement for this historically inflation-prone country. Consumer
inflation fell from 3.9% in 1996 to 1.5% in 1997, but rose gradually to 1.9% in 1999. The
2000 target of 1.5% seems well within reach. The 1992 agreement on wage adjustments, which
has helped keep wage pressures on inflation low, remains in effect. Tight monetary policy
by the Bank of Italy also has helped bring inflation expectations down.

Since 1992, economic policy in Italy has focused primarily on reducing government budget
deficits and reining in the national debt. Successive Italian governments have adopted
annual austerity budgets with cutbacks in spending, as well as new revenue raising
measures. Italy has enjoyed a primary budget surplus, net of interest payments, for the
last 7 years. The deficit in public administration is expected to decline to 1.5% of GDP
in 2000, down from 7% in 1995. Italy joined the European Monetary Union in May 1998.

The national debt should continue to decline slowly. It stabilized in 1995 at roughly 124%
of GDP and is expected to decline to 111% of GDP in 2000. Given the heavy weight of
interest payments in government expenditures, public finances remain susceptible to
international capital market developments, as well as domestic political developments.

Italy's closest trade ties are with the other countries of the European Union, with whom
it conducts about 59% of its total trade. Italy's largest EU trade partners, in order of
market share, are Germany (18%), France (13%), and the United Kingdom (7%).

U.S.-Italy Economic Relations
The U.S.-Italian bilateral relationship is strong and growing. The U.S. and Italy
cooperate closely on major economic issues, including within the G-8. With a large
population and a high per capita income, Italy is one of the United States' most important
trade partners. In 1999, the United States was the fourth-largest foreign supplier of the
Italian market (with a market share of 5.6%) and the largest supplier outside the EU.
Total trade between the United States and Italy exceeded $30 billion in 1999. The U.S. ran
more than a $6 billion deficit with Italy.

Significant changes are occurring in the composition of this trade which could narrow the
gap. More value-added products such as office machinery and aircraft are becoming the
principal U.S. exports to Italy. The change reveals the growing sophistication of the
Italian market, and bilateral trade should expand further. During 1998, the United States
imported about $19 billion in Italian goods while exporting about $11.3 billion in U.S.
goods to Italy. U.S. foreign direct investment in Italy at the end of 1998 exceeded $14.3
billion; Italian investment in the U.S. was roughly $9 billion.

GOVERNMENT
Italy has been a democratic republic since June 2, 1946, when the monarchy was abolished
by popular referendum. The constitution was promulgated on January 1, 1948.

The Italian state is highly centralized. The prefect of each of the provinces is appointed
by and answerable to the central government. In addition to the provinces, the
constitution provides for 20 regions with limited governing powers. Five
regions--Sardinia, Sicily, Trentino-Alto Adige, Valle d'Aosta, and Friuli-Venezia
Giulia--function with special autonomy statutes. The other 15 regions were established in
1970 and vote for regional "councils." The establishment of regional governments
throughout Italy has brought some decentralization to the national governmental machinery.

The 1948 constitution established a bicameral Parliament (Chamber of Deputies and Senate),
a separate judiciary, and an executive branch composed of a Council of Ministers (cabinet)
which is headed by the president of the council (prime minister). The president of the
republic is elected for 7 years by the Parliament sitting jointly with a small number of
regional delegates. The president nominates the prime minister, who chooses the other
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