News Analysis: Controversial Greek bailout plan mixed bag for Italy: experts

The deep economic troubles in nearby Greece have had mixed direct impacts on the Italian economy, experts say.

Greece became the first European Union (EU) state to default on an international debt payment on June 30, triggering a series of events that resulted in Monday's dramatic and controversial deal that will oblige Greece to implement deep austerity measures, including selling off state assets, imposing higher taxes, and making deep pension cuts.

Where Italy is concerned, slower economic growth as a result of the terms of the bailout package would be bad news for Italian exporters. Italy is Greece's second largest trading partner, according to the latest figures: Italy buys 9.0 percent of Greece's exports and accounts for 8.0 percent of the products Greece imports.

On the up side, the resolution assuages investor fears of a widespread debt default that put upward pressure on bond yield not only for Greece, but for other high debt countries in the eurozone, like Italy.

On Monday, after the deal was announced, the yield on Italy's benchmark 10-year bonds dropped more than 1.0 percent, ending the day at 2.11 percent, its lowest level since early June, before the Greece crisis flared up.

But according to Marcello Messori, a professor of political economics at LUISS University here, part of the fallout from the crisis in Greece is trust among EU states.

"It is good news an agreement was reached with Greece, but it was reached via the most difficult path imaginable," Messori said in an interview. "Because of that, the atmosphere of trust in Europe has been damaged."

However, Monday's accord struck between Athens and its European creditors may have another positive impact for Italy, including increased political muscle for Italian Prime Minister Matteo Renzi.

According to Gian Franco Gallo, a political affairs analyst with ABS Securities in Milan, this boosted political might is due to Renzi's role in the talks.

In negotiations over whether or not to extend the third bailout package to Greece, Renzi was one of the most vocal voices among European leaders in favor of extending new credits to Greece.

Renzi lobbied German Chancellor Angela Merkel to soften her country's hardline stance on the negotiations. Renzi's stance earned praise from Greek Prime Minister Alexis Tsipras, who referred to Renzi on Monday as a personal friend and a key Greek ally.

"It is impossible to say whether the final agreement for Greece was impacted in any specific way because of the actions of Italy or any other country," Gallo told Xinhua.

"But it is likely Renzi helped establish himself further as one of the leaders of the European Union. That is significant for a figure who two years ago was the mayor of a mid-sized city," added Gallo. Endit