According to Unioncamere-Prometeia estimates, Basilicata's GDP contracted by 0.4 per cent in 2011, less than in 2010 (-1.3 per cent), compared with an expansion of 0.4 per cent at national level. The economy of Basilicata, unlike that of other regions, did not draw support from the growth in foreign demand, owing in part to regional firms' limited propensity to export.
Industrial production, estimated by Unioncamere, fell by 4.3 per cent, on top of the decline of 4.8 per cent in 2010, reflecting the sharp contraction in activity in the final part of the year. The decline was spread among all the main industries. Between 2008 and 2011 the cumulative loss of industrial production came to 18.5 percent, more than the average for the South.
In 2011 the exports of the region's firms declined again, falling by 3.1 per cent, compared with a large gain at national level (11.4 per cent). The decline was largely due to exports of motor vehicles (around two thirds of the region's total exports), which fell by 5.8 per cent, in contrast with the trend of motor vehicle exports for Italy and for the Southern regions as a whole.
The value added of the construction sector is estimated by Prometeia to have fallen again in 2011, though less sharply than in 2010. The sector was affected by the sluggish property market and the decline in property prices.
According to the Unioncamere survey, retail sales shrank by 5.6 per cent, after falling by 4.0 per cent in 2010. The largest decline in consumption was registered for durable goods, down by 9.5 per cent. By contrast, tourism showed signs of reviving. After stagnating in 2010, overnight stays by visitors to Basilicata rose by 3.9 per cent last year.
The state of the labour market deteriorated during the year: an increase in the number of persons in work in the first half was followed by a decline in the second. Over the year as a whole, employment grew by 1.3 per cent; the gain came from part-time jobs. The employment rate rose to 47.6 per cent; the increase involved all age groups except persons aged 35 to 44. The employment rate is higher for men than for women and for the mature age groups than for younger workers. Recourse to wage supplementation benefits increased by 4.5 per cent, less than in 2010; there was a rise in ordinary wage supplementation, especially in the machining and chemical industries, but a decline in extraordinary benefits and in benefits granted under waivers. The unemployment rate came down to 12 per cent; however, there was an increase in the number of persons not in the labour force who would be willing to work but are not looking for a job because they think they will not find one, together with a rise in the number of underemployed part-time workers, i.e. those immediately willing to work full time.
Bank lending slowed in the course of 2011, particularly in the closing months of the year. The change in December compared with a year earlier was slightly negative (-0.1 per cent); the decline deepened to 1.3 per cent in the first quarter of 2012. The deceleration in lending involved both firms and households. According to the survey of lending officers at the main bank branches operating in the region, the slackening in lending to households and firms was due to a decline in demand together with growing difficulties in obtaining credit. Lending to firms by banks and financial companies slowed to growth of 1.3 per cent, from 3.2 per cent in 2010. Lending to service firms fell significantly, while loans to firms in both manufacturing and construction expanded. According to provisional data, in the first few months of 2012 the decline in lending to firms intensified, extending to all the main branches of activity. The pronounced slowdown in house purchase loans was not fully offset by the acceleration in consumer credit. Credit to households, disbursed by banks and financial companies, slowed to growth of 2.5 per cent in 2011. Provisional data indicate that lending to households contracted in the first few months of 2012.
The ratio of adjusted new bad debts to outstanding loans was equal to 2.6 per cent in 2011 (2.0 per cent in 2010). The deterioration in the quality of credit was especially large for firms (3.7 per cent), particularly in the manufacturing sector (7.0 per cent). For households, instead, the ratio of new bad debts to loans fell slightly.
The increase in credit risk and the cost of funding was reflected in higher borrowing costs. Interest rates on short-term loans to firms rose to an average of 6.7 per cent; in the first three months of 2012 they rose further by 89 basis points, more than the increase recorded in all of 2011. The cost of medium/long-term credit rose by 1.4 percentage points, to an average of 4.9 per cent. In the first three months of this year it jumped to 5.9 per cent.
A two-year decline in the interest rates on loans for house purchases ended in 2011. The annual percentage rate of charge on such loans to households rose by 84 basis points, to 4.2 per cent. In the first three months of 2012 it climbed to 4.5 per cent.
