Italian governments and International Monetary Fund, between the 1940s and 1970s. The political role of international loans

The historical relationship between Italy and the International Monetary Fund (IMF) can be examined from two distinct perspectives, both of which have been, at least in part, overlooked by Italian historiography. The first pertains to the relationship between the IMF as a lender and Italy as a borrower; the second concerns Italy’s role as a member state within the Fund’s decision-making processes. These two dimensions are divided by a pivotal turning point: the 1970s. This chapter focuses on the first of these perspectives, aiming to clarify four key issues. First, why Italy was the earliest among the major nations defeated in the Second World War to join the IMF. Second, why, by the late 1960s, the relationship between Italian governments and the Fund shifted from being largely unconditional to a more ‘realistic’ alignment with both the country’s domestic priorities and its foreign policy objectives. Third, how this relationship eventually stabilized, with international loans becoming a crucial tool for addressing persistent fiscal imbalances. Finally, how, in the 1970s, Italian governments adopted an increasingly ‘pragmatic’ approach to the IMF in response to mounting inflation and the worsening economic and financial crisis.