Summary
The economic crisis continued to afflict the region's economy in 2009. The recession, that had begun in 2008, reached its height in the first half of last year affecting all economic sectors.
Agriculture's performance was particularly negative, with a strong contraction in the olive and cereals crops.
In manufacturing, the most acute phase of the crisis occurred in the first quarter. Orders and production picked up somewhat in the following months. The capacity utilization rate fell significantly and investment diminished.
Construction suffered heavily from the adverse state of the economy. Activity in the public works sector contracted sharply. A slowdown in transactions in the real-estate market was accompanied by a further reduction in property prices.
In services, retail sales diminished in value, particularly owing to the fall in food sales. Overnight stays by tourists declined, especially those by domestic tourists. In the transport sector, transshipment traffic through the port of Gioia Tauro fell considerably. Among the region's airports, only that of Lamezia Terme recorded an increase in passenger traffic.
Employment fell owing to the decline in the construction sector and in the services except for commerce. The fall was more pronounced among the self-employed.
The number of job-seekers diminished, but the rate of exit from the labour market rose at the same time. The negative gap between Calabria and the national average in labour market participation is especially wide for persons aged 25 to 34 and for women. The proportion of undeclared work is the highest among the Italian regions.
In 2009 bank lending slowed further but the rate of increase again exceeded the national average. Preliminary data indicate that in the first few months of 2010 bank lending expanded at a pace similar to that of the end of 2009.
Lending to firms decreased owing both to the drop in firms' demand for loans and to banks' greater caution in granting credit. In their responses to the Bank of Italy's survey, banks reported that the decline in demand was due to major cutbacks in business investment. Compared with the last quarter of 2008, the tightening of lending standards became less intense in the course of 2009; it is expected to come to a halt in the first few months of 2010.
The reduction in spending on durable consumer goods and in activity in the housing market influenced households' demand for loans. Nevertheless, although lending to households decelerated in 2009, its growth still exceeded the national average and in the final months of the year gained pace.
Loan quality, already significantly worse than the national average, deteriorated sharply in 2009 in the construction sector and, to a lesser extent, in services. By contrast, in manufacturing the impairment rate improved with respect to the high levels at which it had stood since the second half of 2008.
