ROME (Reuters) - Italy's leading business group Confindustria urged the centre-right government on Saturday to carry out economic reforms, including cutting red tape, to boost lagging growth and called on companies to bulk up to face challenges from globalisation.
Confindustria President Emma Marcegaglia said the government of Prime Minister Silvio Berlusconi needed to open up the rule-bound economy by simplifying taxes, lowering spending, stripping away bureaucracy and privatising management of the National Foreign Trade Institute, the export-import bank.
She welcomed measures announced by the government on Thursday to boost growth that featured loosened controls on business, tax breaks for investment in impoverished southern Italy and new rules for managing coastal areas. But she said more had to be done.
"In a situation where public spending has to come down and politics often has its own agenda separate from the issue of growth, we have to ask for few but well-defined reforms," Marcegaglia, a longtime government critic, told reporters after an extraordinary congress of 5,700 business representatives from across the euro zone's third-biggest economy.
Italy has the fourth-biggest public debt in the world. The government is forecasting growth at 1.1 percent this year, behind the European average and down from 1.3 percent last year.
The great majority of businesses are small and mid-sized companies under increasing pressure from foreign competition, especially from China, and Marcegaglia said 75 percent of them planned to gain in size over the next year to better compete.
In one sign of increase of scale, the number of incorporated companies rose to 21 percent in 2010 from 16 percent in 2007, she said.
"The slogan 'small and local' doesn't work anymore. Small is no longer beautiful," she said.
Marcegaglia rejected a complaint by Berlusconi that businesses needed "to do more for us," saying that Confindustria's member companies generated 70 percent of growth. "We do things for this country every day," she said.
Local elections next weekend will show how badly the sluggish economy and criminal cases involving Berlusconi, a media tycoon, have damaged the ruling coalition.
Berlusconi faces several trials on charges including fraud and paying for sex with a nightclub dancer when she was under the legal age limit of 18 for sex with a prostitute. He has denied all charges.
Marcegaglia made her comments a day after hundreds of thousands of workers across Italy snarled public transport and services in a strike called by the biggest trade union to protest against what it called attacks on workers' rights.
