Italy’s economy is so back. Sort of. It’s been a rocky economic road for the country of late. How rocky? Italy has gone through two recessions since 2008 and the country’s GDP, adjusted for inflation, has posted zero growth since 2000. So no news hasn’t exactly been good news for Italy. On Wednesday, however, the country got an unexpected spot of (quasi) good news—the country is no longer in recession.
What stops this development from being sheer, unadulterated economic euphoria is how Italy managed to emerge from its latest economic quagmire. The European Union rejiggered how its economic data is calibrated, boosting Italy’s growth from a .1 percent decline in the first quarter of this year to a zero percent decline. While that’s not exactly a blowout win for the country, making this relative progress even more relative is that Italy’s new, improved economic record was because “adding illegal revenue from hookers, narcotics and black market cigarettes and alcohol to the eurozone's third-biggest economy boosted gross domestic product figures,” Agence France Presse reports.
Since a country’s economy must contract for two consecutive quarters to technically be in recession, Italy, by padding the numbers to post zero growth in the first quarter, technically is no longer in recession. “The new [accounting] system, known as SEC 2010, aims to facilitate comparison of data between countries, regardless of whether or not they have legalised prostitution and decriminalised drugs—activities already included by some in their GDP calculations,” AFP reports.
Italy will surely call the news a win—even if by forfeit. But, as my colleague Joshua Keating pointed out earlier this year: “There’s something a bit strange about governments taking credit in their official statistics for wealth generated by activities that they throw people in jail for, but what’s a little hypocrisy in the name of accounting accuracy?”