Country profile · Southern Europe
Italy
Italy is the world's ninth-largest economy, worth $2.55 trillion in 2025, and the third-largest in the EU. Prime Minister Giorgia Meloni leads the longest-lasting government in the history of the Italian Republic, a record it set on September 4, 2026. Government debt was 136.7% of GDP at the end of 2025, the second highest in the EU after Greece.
Where Italy ranks
All rankings →Who runs Italy?
Prime Minister Giorgia Meloni runs Italy. She took office in October 2022, the first woman in the post. Her coalition of Brothers of Italy, Lega, Forza Italia and Noi Moderati holds 233 of the 400 seats in the lower house, and on September 4, 2026 it became the longest-lasting government of the Italian Republic. Meloni was born in Rome in 1977. Her father left when she was about one and was later jailed in Spain for smuggling hashish. She grew up in the working-class Garbatella district and worked as a nanny, a waitress and a bartender. She has said she does not consider The Lord of the Rings a fantasy book. At 15 she joined the youth wing of the Italian Social Movement, a party founded in 1946 by veterans of Mussolini's regime. In March 2026 voters rejected her justice reform, 53.2% to 46.8%.
- Brothers of Italy 118
- Lega, Forza Italia and Noi Moderati 115
- Opposition and others 165
- Vacant 2
Official portrait (2024): Government of Italy, Wikimedia Commons, CC BY 3.0 IT
Who are Italy's allies and rivals?
The United States is Italy's main ally, and about 12,700 US troops were based in Italy at the end of 2025. The 2026 Iran war strained the alliance. In March Prime Minister Meloni said Italy would not take part, and Defense Minister Guido Crosetto refused a landing at Sigonella to US bombers that had not asked for permission in time. On April 12 President Trump attacked Pope Leo XIV, and Meloni called his words "unacceptable." Trump answered: "I thought she had courage, but I was wrong." Meloni replied that being allies "certainly does not mean being vassals or subjects." Russia is the main rival. In July 2026 two former Italian intelligence officers were arrested for spying for Russia, and the two countries expelled each other's diplomats. Italy has sent Ukraine 12 military aid packages since 2022, but no troops.
Allies and partners
United StatesAbout 12,700 troops based in Italy
FranceQuirinal Treaty signed in 2021
GermanyLargest trade partner; security pact, 2026
United KingdomBuilding a new fighter with Japan
AlgeriaLargest gas supplier
AlbaniaHosts Italian migrant centers since 2024
Ukraine12 military aid packages since 2022
Rivals
RussiaSpy arrests and expulsions, July 2026
- Aviano Air Base US air base; US nuclear bombs are stored here and at Ghedi
- Naples Headquarters of the US Sixth Fleet
- Lampedusa Island 113 km from Tunisia, where most migrant boats land
- Gjader Italian-run migrant center in Albania, opened in 2024
- Italy
- Partner
- Rival
Who does Italy trade with?
Germany is Italy's largest trade partner, both as a buyer and as a supplier. Italy exported €643.2 billion of goods in 2025 and imported €592.5 billion, a surplus of €50.7 billion, and it is the world's fifth-largest exporter of manufactured goods. Machinery led exports at €99.5 billion, and pharmaceutical exports grew 28.5% to €69.2 billion. Exports to the United States rose 7.2% in 2025 despite a 15% US tariff on most EU goods, but without medicines they fell 1.6%. China supplied 10.2% of Italy's imports but bought only 2.2% of its exports, leaving a deficit of €46.3 billion, Italy's largest with any country. Russia supplied about 40% of Italy's gas imports in 2021. Algeria is now the largest supplier. Italy also holds the world's third-largest gold reserves, 2,452 tonnes: 44.86% is kept in Italy and 43.29% in the United States.
Sells to
Share of Italy's exports
- Germany11.2%
- United States10.8%
- France10.1%
Spain5.9%
Switzerland5.5%
Buys from
Share of Italy's imports
- Germany14.4%
China10.2%- France8.0%
Netherlands6.6%- United States6.0%
Goods, 2025. Shares of Italy's exports and imports in Istat data.
How strong is Italy's military?
SIPRI estimates that Italy spent $48.1 billion on its military in 2025, the 12th most in the world. By NATO's count, spending reached 2.01% of GDP in 2025, up from 1.52% in 2024, mainly because Italy began counting items such as the Coast Guard and military pensions. Italy agreed to NATO's target of 5% by 2035, but at the July 2026 summit Prime Minister Meloni said: "I will never take money away from hospitals to buy tanks." The navy flies F-35B jets from the carrier Cavour, and with Britain and Japan Italy is building a new fighter, GCAP, due in 2035. Italy has about 1,000 troops in Lebanon, where an Italian general commands the UN force. It has no nuclear weapons of its own. In a 2024 Gallup International survey, 14% of Italians said they would fight for their country.
Military spending in Europe, 2025
Full ranking →- Germany$114bn
- United Kingdom$89.0bn
- France$68.0bn
- Italy$48.1bn
Poland$46.8bn- Spain$40.2bn
- Netherlands$28.9bn
SIPRI Military Expenditure Database, 2026 edition
Why is Italy's debt so high?
Italy's debt was built up mostly in the 1980s, and it has stayed above 100% of GDP since 1992. Debt was just under 60% of GDP in 1980. In 1981 the Bank of Italy was freed from its duty to buy unsold government bonds, which raised the state's borrowing costs, and through the 1980s the state borrowed 11 to 15% of GDP a year. Debt reached 154.4% of GDP in 2020, during COVID, and a building tax credit, the Superbonus, has cost the state more than €131 billion since 2020. At the end of 2025 the government owed €3,095.5 billion, 136.7% of GDP (the IMF's estimate in the chart is 137.1%). Interest cost €87.1 billion in 2025, 3.9% of GDP. The spread, the gap between Italian and German 10-year bond yields, hit 575 basis points in November 2011, when Berlusconi resigned. On September 30, 2026 it was 102.9.
Government debt as a share of GDP, 2025
Full ranking →
Japan206.5%
Greece145.7%- Italy137.1%
- United States123.9%
- France116.0%
- United Kingdom102.3%
- Spain100.4%
- Germany62.9%
IMF World Economic Outlook, April 2026