According to Prometeia data, Valle d'Aosta's GDP grew by 1.4 per cent in 2007 (0.8 per cent in 2006); according to Istat data, in 2006 it had increased by 0.9 per cent, mainly as a result of the expansion in manufacturing and construction.
The slowdown in orders received by industrial firms in the final part of the year attenuated the positive trend of production and adversely affected investment decisions. Construction companies also experienced a weakening in activity, although demand for public works began to grow again.
In the service sector, the main indicators show a worsening compared with the previous year. Turnover and investment fell, and overnight stays by Italian and foreign tourists alike declined. On the other hand, retail sales grew at a higher rate than in the regions of the North-West as a whole.
Despite the signs of slowing activity in the main sectors of the economy, the average number of persons in work during the year rose again, leading to an increase in both the employment rate and the participation rate. The unemployment rate edged upwards but remains among the lowest in Italy.
Bank lending decelerated, with a contraction in loans to service firms and a slowdown in lending to consumer households both for house purchases and in the form of consumer credit. Credit risk rose slightly.
Savers in the region continued to prefer relatively low-risk financial instruments. Investment in bank deposits and bank bonds grew further, though more slowly than in 2006, while that in government securities and corporate bonds gained pace. By contrast, investment in shares, individually managed portfolios and in investment fund units declined.
The productive system of Valle d'Aosta, in which services and construction play a larger role than in Italy as a whole, grew faster than the Italian average in the period 2001-03 and at the same rate in 2004, whereas in the two years 2005-06 the differential was negative. The region's positive growth differential in the three years at the start of the decade was due primarily to the results in the mechanical machinery and electric power generation industries; it was attenuated by the occurrence of exceptional events between 1999 and 2001 -- the shutdown of the Mont Blanc tunnel and the big flood -- that had repercussions on important branches of the service sector. The worsening of regional economic growth in the subsequent three years can be traced to developments in manufacturing and construction, whose performances converged with the national averages, and in the service sector, where value added contracted owing to the negative results registered for general government and for sundry business and household services.
The difficulties encountered met by manufacturing and services in 2005-06 are confirmed by an analysis of companies' financial statements. Leverage has increased in both sectors and profitability has been negative in services since 2002. These two phenomena, together with an increase in firms' external funding needs, have regarded the larger firms, whose impact on aggregate sectoral results is proportionate to their size.
