alessandra perrazzelli : italy is back on track - recovery, resilience and attractiveness remarks by ms alessandra perrazzelli, deputy governor of the bank of italy, at the workshop on italy ’ s attractiveness, dubai expo, dubai, 24 november 2021. * * * i would like to thank the organizers for inviting me to this workshop on italy ’ s attractiveness. in my short speech, i will focus on three aspects : the economic outlook for the italian economy ; the medium - term growth prospects and risks ; and the great opportunity represented by the national recovery and resilience plan ( nrrp ), which is the plan italy has designed and is implementing in the context of the next generation eu ( ngeu ) fund, the european recovery package to support member states hit by the covid - 19 pandemic. the economic outlook the italian economy returned to growth early this year. after a modest expansion in the first quarter, gdp rose markedly in the following two – by 2. 7 per cent in the second quarter ( on the previous period ) and, according to the preliminary estimate, by 2. 6 per cent in the third – boosted by domestic demand and, to a lesser extent, by external trade. the progress in the vaccination campaign contributed to strengthening consumer and business confidence and allowed a faster reopening of production and commercial activities. households increased spending on goods and, above all, services. firms expanded their capital accumulation plans, benefitting from favourable financing conditions and abundant liquidity. recovery was diffuse amongst the main sectors, with industrial activity now standing above pre - pandemic levels. consumer price inflation has recently reached high levels ( 3. 2 per cent in annual terms last october ), prompted mostly – as in the euro area as a whole – by factors that we assess as transient, notably the surge in commodity prices, which may continue in the coming months but is not expected to extend into the medium term. so far, the recent contractual agreements do not suggest any strong upturn in wage growth, in a context where margins of spare capacity in the labour market are still ample. that said, inflation developments and the related expectations, as well as uncertainties on the monetary policy responses by the main central banks, are reflected in higher financial markets volatility ; in the recent weeks sovereign spreads of some euro - area countries, italy is back on track : recovery, resilience and attractiveness remarks by alessandra

to the centre of the policy agenda, making the climate challenge a cross - cutting priority across all of its activities. at the g20 level, we have been exploring the issues related to sustainable finance and climate change since 2016. the italian presidency has proposed to re - establish the sustainable finance study group which will take stock of the recent developments on sustainable finance and climate risks, with the ultimate goal of suggesting a ‘ sustainable ’ growth path. the urgency of the recovery could renew momentum and reshape our economic model around a low - carbon strategy : improving energy efficiency, deploying renewables and energy storage and developing carbon capture technologies. the works of the group under the italian presidency will mainly focus on improving the quality, availability and comparability of data to assess climate - related issues and, more generally, sustainability, financial risks, and opportunities. the group could also investigate the areas of future action to achieve the sustainable development agenda of the united nations, in particular access to modern forms of sustainable energy and natural capital conservation and restoration. the transition to a zero - emissions economy can be fostered by the financial system, given its key role in the allocation of resources. several analyses show that incorporating environmental, social and governance ( esg ) factors in investment strategies does not hamper their financial performance. the risk - adjusted returns to sustainable investment are indeed often higher than those achieved using traditional financial models. during the recent market turmoil, the preferences of financial investors for sustainable investments have proven resilient. another important venue to discuss all possible instruments to reach carbon neutrality, including ‘ climate cooperation ’, will be this year ’ s conference of the parties ( cop26 ), under the united nations framework convention on climate change. the coincidence of italy being president of the g20 and co - chair of the cop26 ( the other chair is the uk, which is president of the g7 ) may allow us to bring forward the climate change agenda on many fronts simultaneously, such as the involvement of the private sector in the financing of the green agenda. 8. the covid - 19 pandemic and the ensuing global health crisis have clearly highlighted the costs of extreme health emergencies. the risk of another pandemic is high. in 2018, in an article for the world health organisation ( who ), larry summers and two distinguished public health scholars wrote that : ‘ few doubt that major epidemics and pandemics will strike again and few would argue that the world is adequately prepared ’. 1 evidently, last