Italy profile

Demography and Health

Italy’s population sits around 59 million people in 2024 (approximately 58,986,023), making it one of the larger European populations though its growth profile is shaped by aging and migration dynamics. The birth rate is very low at 6.4 births per 1,000 people (2023), and the death rate is relatively high at 11.2 deaths per 1,000 people, contributing to an aging demographic and a shrinking natural increase. Life expectancy stands at a high 83.7 years (2023), underscoring strong health outcomes and longstanding social development, while the crude mortality of under-5 children is low at 2.8 per 1,000 live births (2023). Net migration of about 95,246 (2024) helps offset natural population decline to some extent, but overall population aging remains a central policy and social challenge. In health spending, current health expenditure accounts for 8.52% of GDP (2023), and physicians number 4.25 per 1,000 people (2022), indicating a well-distributed medical workforce. Domestic general government health expenditure per capita, PPP, is around 3,708 international dollars (2022). The health system is supported by relatively strong indicators—life expectancy and access to care—yet poverty remains non-trivial at about 20.1% of the population (2021), and 2.5% of the population faced undernourishment (2022). Together, these figures suggest a society with high health outcomes on average, but with notable regional disparities, aging pressure on the pension and healthcare systems, and ongoing challenges related to income distribution and nutrition in certain segments.

Economy

Italy’s economy features a high standard of living, with GDP per capita at 40,226 current US dollars in 2024 (rank 28), and a GDP per capita at purchasing power parity of 60,847 (2024, rank 30). The economy shows a balanced but growth-constrained profile: inflation remains modest at 0.982% (2024), supporting price stability, while unemployment sits at 7.63% in 2023 (rank 21), indicating a resilient but not exceptionally dynamic labor market. The export orientation remains significant, with exports of goods and services comprising 32.7% of GDP in 2024 (rank 77) and imports at 30.4% of GDP (rank 96), implying a broadly trade-enabled economy with a favorable external balance. The current account balance is positive at 1.13% of GDP (2024), and foreign direct investment net inflows amount to 0.918% of GDP (2024), suggesting a stable but selective investment environment. Italy is a notable producer in high-technology sectors, evidenced by high-technology exports totaling about 51.8 billion US dollars (2023) and a strong patent activity among residents (10,281 applications in 2021, rank 10). Research and development expenditure stands at 1.39% of GDP (2022), modest by global leaders but indicative of ongoing innovation. Together, these indicators point to an advanced, diversified economy with solid competitive strengths in manufacturing, technology, and services, even as structural issues—such as demographic pressures, regional disparities, and the need for sustained productivity growth—continue to shape policy priorities.

Trade and Investment

Trade and investment dynamics in Italy show a robust external orientation. Exports of goods and services represent 32.7% of GDP in 2024, while imports account for 30.4%, reflecting a net export position and a tightly linked supply chain with global markets. The current account balance stands at 1.13% of GDP (2024), signaling a historically stable external position. Foreign direct investment net inflows reach 0.918% of GDP (2024), indicating steady but cautious foreign investment activity. In terms of infrastructure facilitating trade, the Logistics Performance Index scores 3.8 (2022), with a high ranking of 8, pointing to solid quality of trade and transport-related infrastructure. Italy also demonstrates innovation capacity through resident patent activity (10,281 applications in 2021) and a notable share of high-technology exports (over 51 billion US dollars in 2023). These factors collectively portray an economy well integrated into global value chains, with strengths in technology, manufacturing, and services. Potential growth areas include expanding FDI, accelerating digitalization, and further upgrading logistics and energy networks to sustain competitiveness.

Governance and Institutions

Italy’s governance and institutional framework shows a mix of strengths and room for improvement. Political stability and absence of violence/terrorism score 0.583 in 2023 (rank 65), reflecting a relatively stable political environment by international standards. Regulatory quality is somewhat stronger at 0.644 (rank 50), suggesting a capable regulatory framework that supports business and investment. The rule of law sits at 0.39 (rank 75), indicating meaningful challenges in courts and contract enforcement that can affect investment risk and economic efficiency. Control of corruption is 0.55 (rank 57), and government effectiveness is 0.611 (rank 54), both signaling resilient governance but with scope for further strengthening, particularly in judicial depth and anti-corruption measures. Overall, Italy’s institutions provide a credible environment for business and public service delivery, yet improvements in rule-of-law outcomes and governance depth would further enhance trust, investment, and long-run competitiveness.

Infrastructure and Technology

Italy exhibits solid infrastructure and technology indicators that support competitiveness. The Logistics Performance Index scores 3.8 (2022), with a rank of 8, indicating high-quality trade and transport-related infrastructure, good customs performance, and efficient logistics services. Internet usage is widespread, with 87.0% of the population online in 2023, underscoring a strong digital backbone for commerce, education, and innovation. High-technology exports totaled about 51.8 billion USD in 2023, reflecting a substantial technological orientation in industry. Research and development expenditure is 1.39% of GDP (2022), indicating ongoing investment in knowledge creation, though there is room to increase R&D intensity to bolster productivity growth. The country hosts a notable density of physicians (4.25 per 1,000 people in 2022), and a robust health expenditure framework confirms both a strong service sector and public health capacity. Patents applications (residents) reached 10,281 in 2021, signaling active inventive activity by domestic residents. The infrastructure and technology landscape thus combines excellent logistics with strong connectivity and innovation, while further upgrades in R&D funding and digital infrastructure could push productivity higher and support a more dynamic economy.

Environment and Sustainability

Italy’s environmental profile shows both progress and challenges. Renewable energy accounts for 17.5% of total final energy consumption (2021), reflecting ongoing diversification of the energy mix but also highlighting reliance on imports for energy or fossil-based inputs. Total greenhouse gas emissions per capita exclude LULUCF at 6.34 tCO2e (2023), and the country faces water resource pressures, with water stress measured as freshwater withdrawal as a share of available resources at 29.6% (2021) and a level of water stress at 29.6%. The country also grapples with social dimensions relevant to sustainability: poverty headcount at national poverty lines is 20.1% (2021), and undernourishment prevalence is 2.5% (2022). These indicators suggest that while Italy has made strides in decarbonization and resource management, it remains vulnerable to climate-related risks and regional inequalities in access to resources and nutrition. Ongoing investments in energy efficiency, renewable capacity, and climate resilience—coupled with targeted social protections and nutrition programs—would bolster sustainable development, reduce emissions intensity, and promote inclusive growth while leveraging Italy’s strengths in technology, industry, and governance.