Tensions flared in the financial markets starting in the second half of 2011 in connection with worries about the sustainability of the public finances of some euro-area countries. The tensions affected the Italian government securities yields, necessitating the passage of repeated budget adjustment measures. Accompanying these difficulties was an overall worsening of the economic climate, with production slowing down before it had regained its pre-crisis levels and a downward revision of the macroeconomic forecasts. Businesses grew more uncertain about the way market conditions would develop. This environment affected Liguria, which in 2010 and in the first half of 2011 had participated moderately in the recovery of the national economy; as in other regions, there was a new slowdown in economic activity.
In the first half of the year the region's industry recorded modest export-led growth, but in the second half the downturn in orders impacted negatively on production and turnover. Over the year as a whole, the level of production was sustained by the metalworking, electronics and telecommunications sectors, while such sectors as shipbuilding and construction materials continued to contend with severe problems. Against a backdrop of widespread uncertainty about the market's prospects, capital spending stagnated.
The long period of weakness in the construction industry continued. Investment in residential building diminished, particularly for new buildings. Both the number of transactions and house prices in real terms fell slightly. Planning of some public works projects went ahead, albeit in a context marked by financial and other difficulties. Work continued on the projects under way for the rail network and in some port areas.
The movement of cargo ships through the region's ports diminished somewhat, but container traffic increased, benefitting from expanding international demand for the transport of manufactured goods. However, the increase did not match the average result recorded in the ports of the Western Mediterranean and, especially, those of Northern Europe. Freight rates continued to come down, owing to persistent excess shipping capacity at global level.
Wholesale and retail trade recorded a fall in sales of durable goods, reflecting the further contraction in households' disposable income, which also suffered from the floods that hit the region in the autumn. Hotels and other lodging facilities enjoyed an increase in the number of overnight stays by visitors, especially those from abroad.
On average for the year, the number of employed persons rose slightly and the unemployment rate fell marginally. These trends were concentrated in the first half of the year; in the second, the number of employed persons stagnated. Employment continues to be significantly lower among youngers, whose contribution diminished significantly in the period of the crisis. In contrast with the national trend, the number of hours of wage supplementation authorized rose, reflecting the increase in special benefits in the manufacturing sector.
Bank lending to residents in Liguria grew at a moderate rate, more slowly on average than in the previous year. Firms' demand for credit remained weak in connection with the low level of investment in physical capital. Conversely, the necessity to restructure debt and the need to finance working capital, because of the lengthening of collection time for accounts receivable, moderately increased credit demand. The slowdown in lending to households, largely for mortgage loans, reflected the drop in disposable income and the uncertain employment outlook.
The average interest rates on bank loans rose, especially in the medium- and long-term component, not least because of banks' difficulty in raising funds on the wholesale markets due to the sovereign debt tensions.
New bad debts decreased in relation to outstanding loans to firms; however, the share of positions with repayment problems, up slightly, remained at historically high levels.
The bank deposits of Ligurian households and firms began to grow again in the second half of 2011, albeit at a slow pace. The value of households' securities diminished, chiefly as a consequence of the fall in market prices; the portion of the portfolio invested in government securities and Italian bank bonds expanded at the expense of other financial instruments (shares, investment funds and non-bank bonds).
