Italy Agrees to Sell Public Assets
06/15/2012| 10:36am US/Eastern
ROME--The Italian government of Prime Minister Mario Monti on Friday said it approved measures that will allow it to sell initially some 10 billion euros ($12.6 billion) of public assets in about a month to slash the country's public debt.
"We will reduce the state's assets, firstly with a quick sale of [three government agencies] SACE, Simest and Fintecna worth EUR10 billion to [state-controlled lender] CDP," said Deputy Economy Minister Vittorio Grilli at a press conference in Rome following a cabinet meeting.
SACE is a credit export agency, Simest is an entity that promotes foreign expansion by companies, and Fintecna deals with state-asset management.
Mr. Grilli ruled out any plans at present to sell the treasury's remaining controlling stakes in key companies Eni SpA (E), Enel SpA (>> Enel S.p.A.) and Finmeccanica SpA (>> Finmeccanica SpA).
The government also approved a decree targeting measures to promote growth after a series of tax-laden austerity packages crippled domestic demand and consumer confidence hit a record low.
"These measures will free up funds worth between EUR30 billion and EUR35 billion in new resources," said Industry Minister Corrado Passera.
Italy, which must service a public debt of more than EUR1.9 trillion, or 120% of gross domestic product, is facing a sharp economic contraction. The government estimates gross domestic product will shrink 1.2% this year, while the European Commission and the International Monetary Fund, among others, see a bigger decline.
Friday's measures approved by the cabinet are "robust," said Premier Monti at the same press conference.
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