Italy Republic Of 18-K/A Annual report (foreign governments) (amended)

Exhibit 1

Recent Developments update dated September 10, 2003

Recent Developments

     The information included in this section supplements the information about the Republic of Italy that is contained in Exhibit D to the Republic’s annual report on Form 18-K, as amended, for the fiscal year ended December 31, 2001. To the extent that the information included in this section differs from the information set forth in the annual report, you should rely on the information in this section.

The Italian Economy

     Italy’s real GDP declined at a seasonally adjusted rate of 0.1 per cent in the second quarter of 2003 and grew at a seasonally adjusted rate of 0.3 per cent during the twelve months ended June 30, 2003, based on ISTAT data. Italy’s seasonally adjusted average unemployment rate decreased from 8.9 per cent during the first quarter of 2003 to 8.8 per cent in the second quarter of 2003. Consumer prices, as measured by the harmonized EU consumer price index, increased at a rate of 2.9 per cent during the twelve months ended July 31, 2003.

2004-2007 Program Document Objectives

     In July 2003 the Government finalized and presented to Parliament its 2004-2007 Program Document. The Program Document is based on the assumption that real GDP will grow 0.8 per cent in 2003, primarily due to sustained domestic demand, somewhat offset by a decline in exports. The general Government budget deficit, as a percentage of GDP, is targeted at 2.3 per cent in 2003, unchanged from 2002. The Program Document also targets annual budget deficit reductions, with a substantially balanced budget achieved in 2007 as a result, inter alia, of a progressive increase in primary surplus from 3.0 per cent of GDP in 2003 to 5.2 per cent of GDP in 2007 and a reduction in interest payments from 5.3 per cent of GDP in 2003 to 5.1 per cent of GDP in 2007.

     The following table sets forth information, for the years indicated, on Italy’s projected general Government budget deficit and public debt to GDP ratios, and the gross domestic product and inflation assumptions underlying the 2004-2007 Program Document.

	2003			2004			2005			2006			2007
	(Target)			(Target)			(Target)			(Target)			(Target)
Net Surplus/(Borrowing), as a percentage of GDP		(2.3	)		(1.8	)		(1.2	)		(0.5	)		0.1
Primary balance, as a percentage of GDP		3.0			3.1			3.8			4.6			5.2
Public debt, as percentage of GDP		105.6			104.2			101.7			99.4			97.1
GDP (% real growth rate)		0.8			2.0			2.3			2.5			2.6
Inflation (% real growth)		2.4			1.7			1.5			1.4			1.4
Unemployment rate (%)		8.8			8.5			8.2			7.9			7.5

Source: 2004-2007 Program Document

Because the Program Document is based on projections of future economic developments, including international economic trends, there can be no assurance that the objectives of the Program Document will be attained.

Real GDP and Expenditures

     The following table sets forth information relating to real GDP and expenditures for the periods indicated, including revisions of data previously published for 1998 through 2001.

			1998(1)		1999		2000			2001			2002
			(millions of euro)
Real GDP				969,130		985,253		1,016,192			1,034,549			1,038,394
Add: Imports of goods and services				253,285		267,349		291,121			293,955			298,443
Less: Exports of goods and services				276,325		276,584		309,044			312,453			309,409
		Total goods and services available for domestic expenditure(2)		946,090		976,018		998,268			1,016,051			1,027,429
Domestic expenditure
	Private sector consumption			580,294		595,251		611,570			617,941			620,624
	Public sector consumption			171,730		174,188		177,095			183,270			186,464
		Total domestic consumption		752,024		769,439		788,665			801,211			807,088
	Gross fixed investment			186,229		195,623		209,607			215,147			216,257
	Changes in inventories			7,837		10,958		(4	)		(308	)		4,084
		Total domestic expenditures(2)		946,090		976,020		998,268			1,016,050			1,027,429

Source: Annual Report of the Bank of Italy (2003)
(1)	For convenience, 1998 lire amounts have been translated into euros at the fixed exchange rate of Lit. 1936.27 to €1.00, which took effect on January 1, 1999.
(2)	Total goods and services available for domestic expenditure do not match total domestic expenditure figures for each of 1999 and 2001 due to the effect of rounding.

Selected Balance of Payments Indicators 1998 through 2002

     The following table illustrates the balance of payments for the periods indicated, including revisions of data previously published for 1998 through 2001.

	1998(1)			1999			2000			2001			2002
	(millions of euro)
Current Account		20,444			7,692			(6,305	)		(740	)		(7,318	)
Capital Account		2,249			2,789			3,195			936			838
Financial Account		1,282			(8,867	)		4,287			(3,294	)		8,538
Errors and omissions		(23,975	)		(1,614	)		(1,177	)		3,098			(2,058	)

Source: Annual Report of the Bank of Italy (2003)
(1)	For convenience, 1998 lire amounts have been translated into euros at the fixed exchange rate of Lit. 1936.27 to €1.00, which took effect on January 1, 1999.

     Italy’s current account showed a deficit of €7.3 billion in 2002, compared to €0.7 billion in 2001. The deterioration in Italy’s current account was principally due to a deficit on services of €3.7 billion compared to the balance of account recorded in 2001, reflecting a decrease in the surplus on travel and a widening of the deficit on transport and communications, and to an increase in the income deficit from €11.6 billion in 2001 to €15.4 billion in 2002. The current account deficit was partially offset by a decrease in

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the current transfers deficit from €6.5 billion in 2001 to €5.6 billion in 2002, reflecting lower public net transfer outflows, partially offset by increasing private net transfer outflows. Italy’s visible trade surplus remained substantially unchanged in 2002 and 2001 at €17.3 billion and €17.4 billion, respectively.

     The capital account surplus in 2002 was substantially unchanged at €0.8 billion compared to €0.9 billion in 2001.

     The financial account showed a surplus of €8.5 billion in 2002, compared to a deficit of €3.3 billion in 2001. This was principally attributable to an increase in portfolio investment from a deficit of €7.6 billion in 2001 to a surplus of €16.1 billion in 2002 and to a decrease in net direct investment outflow from €7.4 billion in 2001 to €2.7 billion in 2002. The improvement in the financial account was offset in part by a decrease in surplus on “other investments” from €11.7 billion in 2001 to €1.0 billion in 2002, reflecting an increase in net outflows by Italian banks partially offset by an increase of cash repatriated by Italian residents in the first six months of 2002.

Public Finance — General Government Revenues and Expenditures

     The table below sets forth general Government revenues and expenditures for the five-year period ended at December 31, 2002, including revisions of data previously published for 1998 through 2001. The table does not include revenues from privatizations, which are deposited into a special fund for the repayment of outstanding Treasury securities and cannot be used to finance current expenditures. Accordingly, proceeds from privatizations do not affect the financial balance, but do contribute to a decrease in the public debt and consequently the ratio of public debt to GDP.

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			1998(1)			1999			2000			2001			2002
						(millions of euro)
Expenditures
Current expenditures				487,402			492,017			512,253			539,453			551,390
	of which
	Total consumption			187,981			196,114			209,206			224,827			230,151
		of which
		Wages and salaries		114,450			117,955			123,480			130,968			134,593
		Cost of goods and services		73,531			78,159			85,726			93,859			95,558
	Interest expense			86,011			74,738			75,333			78,013			71,261
	Production grants			14,420			13,681			13,903			14,473			12,497
	Social services			181,894			189,990			195,460			202,217			215,363
	Other current expenditures			17,095			17,494			18,351			19,923			22,118
Capital expenditures(2)				41,345			44,088			29,691			47,825			42,888
	Investments			25,524			26,773			27,807			30,175			23,165
	Investment grants			11,402			13,297			13,292			15,687			17,982
	Other capital expenditures			4,420			4,018			(11,408	)		1,963			1,741
Total expenditures				528,747			536,105			541,944			587,278			594,278
	% of GDP			49.3	%		48.4	%		46.5	%		48.1	%		47.2	%
Revenues
Current revenues				491,177			511,396			529,290			551,647			559,606
	of which
	Tax revenues			318,848			333,935			345,718			359,195			360,929
		of which
		Direct taxes		154,454			166,435			170,547			182,703			177,323
		Indirect taxes		164,394			167,500			175,171			176,492			183,606
	Social security contributions			137,712			141,131			148,083			153,906			159,306
	Revenues from capital			5,392			7,115			5,617			6,124			6,384
	Other current revenues			29,225			29,215			29,872			32,422			32,987
Capital revenues				7,372			5,584			5,110			3,402			5,613
Total revenues				498,549			516,980			534,400			555,049			565,219
	% of GDP			46.5	%		46.7	%		45.8	%		45.5	%		44.9	%
Current account surplus/(deficit)				3,775			19,379			17,037			12,194			8,216
	% of GDP			0.4	%		1.7	%		1.5	%		1.0	%		0.7	%
Net borrowing				30,198			19,125			7,544			32,229			29,059
	% of GDP			2.8	%		1.7	%		0.6	%		2.6	%		2.3	%
Primary balance				55,813			55,613			67,789			45,784			42,202
	% of GDP			5.2	%		5.0	%		5.8	%		3.8	%		3.4	%
GDP (nominal value)				1,073,019			1,107,994			1,166,548			1,220,147			1,258,349

Source: Annual Report of the Bank of Italy (2003)
(1)	For convenience, 1998 lire amounts have been translated into euros at the fixed exchange rate of Lit. 1936.27 to €1.00, which took effect on January 1, 1999.
(2)	Revenues from UMTS license sales and disposals of State real estate were deducted from capital expenditures in 2000, 2001 and 2002. Revenues deducted from capital expenditures were, in 2002, €10,800 million, or 0.9 per cent of GDP, from the disposal of State real estate; in 2001, €1,600 million, or 0.2 per cent of GDP, from the disposal of State real estate; in 2000, €13,815 million, or 1.2 per cent of GDP, from the sales of UMTS licenses.

     General government expenditures and revenues have increased in each of the last five years and are expected to increase in 2003. General government expenditures

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increased 1.2 per cent in 2002, compared to an 8.4 per cent increase in 2001. The slowdown in expenditure growth was primarily due to the effect of revenues from the disposal of State real estate in 2002 totaling €10,800 million, which were deducted from capital expenditures. As a percentage of GDP, general government expenditures declined from 48.1 per cent in 2001 to 47.2 per cent in 2002.

     General government revenues increased 1.8 per cent in 2002 primarily due to a growth in social security contributions. As a percentage of GDP, general government revenues decreased 0.6 percentage points to 44.9 per cent in 2002 from 45.5 per cent in 2001.

     Current account surplus decreased by €3,978 million, or 0.3 per cent of GDP, in 2002, reflecting an increase in total consumption and social services expenditures of €5,324 million and €13,146 million, respectively, partially offset by a €6,752 million decrease in interest expenditures and a €5,400 million increase in social securities contributions.

     The following table sets forth the composition of tax revenues for each of the five fiscal years ended December 31, 2002.

			1998(2)		1999		2000		2001		2002
			(millions of euro)
Direct taxes(1)
	Personal income tax			103,406		114,661		113,970		120,931		120,106
	Corporate income tax			21,787		29,759		28,622		32,521		29,420
	Local income tax			3,289		366		165		195		144
	Investment income tax			10,232		11,535		18,426		15,174		12,591
	Other(3)			11,036		5,492		3,774		8,739		7,652
		Total direct taxes		149,748		161,813		164,957		177,560		169,913
Indirect taxes
	VAT			71,052		75,775		89,022		91,515		94,471
	Other transaction-based taxes			18,894		16,464		15,042		14,519		16,479
	Production taxes			26,051		26,945		26,532		25,936		25,959
	Tax on State monopolies			6,061		6,398		7,357		7,305		7,685
	National Lottery			6,813		11,701		8,887		7,722		7,642
	Others			799		701		679		637		639
Total indirect taxes				129,669		137,983		147,519		147,634		152,875
		Total taxes		279,417		299,797		312,476		325,194		322,788

Source: Annual Report of the Bank of Italy (2003)
(1)	The data presented is prepared for the State sector budget and does not correspond precisely to the general government budget figures contained in the preceding table, primarily because the latter include indirect taxes levied by regional and local governments.
(2)	For convenience, 1998 lire amounts have been translated into euros at the fixed exchange rate of Lit. 1936.27 to €1.00, which took effect on January 1, 1999.
(3)	Taxes classified as “other” are non-recurring and, accordingly, this item is highly variable.

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     Direct taxes receipts decreased by 4.3 per cent, principally due to a decline in corporate income tax receipts attributable to the slowdown in the global and U.S. economies and a decrease in investment income tax due to the decline in share prices and capital gains tax receipts from sales of non-listed companies. Furthermore, direct tax receipts decreased due to the effect of tax cuts introduced in 2000 and 2001.

     Indirect taxes include VAT, excise duties, stamp duties and other taxes levied on expenditures. As a percentage of GDP, indirect tax receipts increased slightly from 14.5 per cent in 2001 to 14.6 per cent in 2002.

Public Debt

     The following table shows the total debt incurred by the Treasury as of the dates indicated. Total debt incurred by the Treasury differs from Italy’s total public debt as it does not include liabilities to holders of postal savings accounts and debt incurred by other state sector entities and other general government entities.

Public Debt of the Treasury

		March 31, 2003		June 30, 2003
		(millions of euro)
Short term bonds (BOT)			132,453		136,075
Medium and long term bonds (initially incurred or issued in Italy)			953,507		957,804
External bonds (initially incurred or issued outside Italy)			90,730		89,256	(1)
	Total debt incurred by the Treasury(2)(3)		1,176,690		1,183,135

Source: Ministry of Economy and Finance
(1)	Italy often enters into currency swap agreements in the ordinary course of the management of its debt. The total amount of external bonds shown above takes into account the effect of these arrangements.
	In addition, the total amount of external bonds shown above includes (i) US$989 million of debt originally incurred outside Italy by Ferrovie dello Stato S.p.A., or FS, the State railway entity, and assumed by the Treasury by law in 1996 and (ii) approximately €3,851 million in obligations outstanding at June 30 under Italy’s $5 billion Commercial Paper program, with maturities of less than one year.
	The amount of external bonds shown above does not correspond to the total amount of external bonds indicated in the table “External Bonds of the Treasury as of June 30, 2003” below, which does not take into account (i) the effect of currency swaps, (ii) FS debt incurred outside Italy, and (iii) Italy’s Commercial Paper program.
(2)	Does not include €516 million of bonds issued by FS.

     The following table shows the external bonds of the Treasury issued and outstanding as of June 30, 2003.

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External Bonds of the Treasury
as of June 30, 2003

			Initial Public					Original Principal		Principal Amount
Title	Interest Rate(%)		Offering Price			Date of Issue	Maturity Date	Amount		Outstanding		Equivalent in euro
US$(1)
$2,000,000,000		6.000%		99.851	%	September 27, 1993	September 27, 2003		2,000,000,000		2,000,000,000		1,750,240,658
$3,500,000,000		6.875%		98.725	%	September 27, 1993	September 27, 2023		3,500,000,000		3,500,000,000		3,062,921,152
$1,500,000,000		6.025% - 6.88%		100.000	%	March 5, 1996	March 5, 2004/12		1,500,000,000		1,500,000,000		1,312,680,494
$750,000,000		5.81% - 6.70%		100.000	%	March 5, 1996	March 5, 2002/10		750,000,000		750,000,000		656,340,247
$1,500,000,000		5.97% - 6.25%		100.000	%	December 20, 1996	December 20, 2004/12		1,500,000,000		1,500,000,000		1,312,680,494
$2,500,000,000		6.000%		99.755	%	May 29, 1998	May 29, 2008		2,500,000,000		2,500,000,000		2,187,800,823
$200,000,000		3.550%		101.625	%	October 22, 1998	October 22, 2003		200,000,000		200,000,000		175,024,066
$3,000,000,000		5.000%		99.465	%	November 20, 1998	November 20, 2003		3,000,000,000		3,000,000,000		2,625,360,987
$2,000,000,000		7.250%		99.682	%	February 7, 2000	February 7, 2005		2,000,000,000		2,000,000,000		1,750,240,658
$1,000,000,000		5.250%		99.737	%	January 16, 2001	January 16, 2004		1,000,000,000		1,000,000,000		875,120,329
$2,000,000,000		6.000%		99.274	%	February 22, 2001	February 22, 2011		2,000,000,000		2,000,000,000		1,750,240,658
$1,000,000,000		5.250%		99.933	%	February 26, 2001	January 16, 2004		1,000,000,000		1,000,000,000		875,120,329
$2,000,000,000		5.250%		99.506	%	April 5, 2001	April 5, 2006		2,000,000,000		2,000,000,000		1,750,240,658
$100,000,000		5.000%		99.635	%	May 15, 2001	May 15, 2005		100,000,000		100,000,000		87,512,033
$85,930,000	Zero Coupon			100.000	%	May 25, 2001	various		85,930,000		85,930,000		75,199,090
$3,000,000,000		4.375%		99.468	%	October 25, 2001	October 25, 2006		3,000,000,000		3,000,000,000		2,625,360,987
$2,000,000,000		4.375%		98.007	%	January 28, 2002	October 25, 2006		2,000,000,000		2,000,000,000		1,750,240,658
$2,000,000,000		5.625%		99.893	%	March 1, 2002	June 15, 2012		2,000,000,000		2,000,000,000		1,750,240,658
$2,000,000,000		4.625%		99.594	%	March 22, 2002	June 15, 2005		2,000,000,000		2,000,000,000		1,750,240,658
$1,000,000,000		5.625%		99.392	%	May 8, 2002	June 15, 2012		1,000,000,000		1,000,000,000		875,120,329
$300,000,000	3 mth libor - 0.065%			100.000	%	August 1, 2002	August 1, 2007		300,000,000		300,000,000		262,536,099
$3,000,000,000		3.625%		99.721	%	September 4, 2002	September 4, 2007		3,000,000,000		3,000,000,000		2,625,360,987
$3,000,000,000		2.500%		99.767	%	January 30, 2003	March 31, 2006		3,000,000,000		3,000,000,000		2,625,360,987
$2,000,000,000		5.375%		98.436	%	February 27, 2003	June 15, 2033		2,000,000,000		2,000,000,000		1,750,240,658
$2,000,000,000		4.375%		99.694	%	February 27, 2003	June 15, 2013		2,000,000,000		2,000,000,000		1,750,240,658
$1,250,000,000		3.25%		99.949	%	May 6, 2003	May 6, 2008		1,250,000,000		1,250,000,000		1,093,900,411
Euro(2)
€1,000,000,000	3 mth libor			100.000	%	October 30, 1990	October 30, 2005		1,000,000,000		1,000,000,000		1,000,000,000
€2,500,000,000		9.250%		98.160	%	March 7, 1991	March 7, 2011		2,500,000,000		2,500,000,000		2,500,000,000
€1,022,583,762	3 mth libor + 0.0625%			99.887	%	December 11, 1995	December 20, 2002/10		1,022,583,762		1,022,583,762		1,022,583,762
€1,000,000,000		6.000%		99.250	%	April 2, 1997	April 2, 2004		1,000,000,000		1,000,000,000		1,000,000,000
€567,225,275		6.250%		100.790	%	May 29, 1997	May 29, 2012		567,225,275		567,225,275		567,225,275
€762,245,086		5.875%		101.594	%	July 2, 1997	July 2, 2007		762,245,086		762,245,086		762,245,086
€1,533,875,644		5.750%		101.663	%	July 10, 1997	July 10, 2007		1,533,875,644		1,533,875,644		1,533,875,644
€60,000,000	FRN/FX			99.610	%	October 8, 1998	October 8, 2018		60,000,000		60,000,000		60,000,000
€61,355,026	Zero coupon			85.336	%	October 12, 1998	September 29, 2003		61,355,026		61,355,026		61,355,026
€300,000,000	Index linked			101.425%		October 15, 1998	October 15, 2018		300,000,000		300,000,000		300,000,000
€1,000,000,000		4.000%		99.342	%	October 26, 1998	October 26, 2005		1,000,000,000		1,000,000,000		1,000,000,000
€176,082,000	7.0% (stepdown)			100.900	%	February 12, 1999	February 12, 2004		176,082,000		176,082,000		176,082,000
€1,000,000,000	CMS			99.950	%	May 6, 1999	May 6, 2019		1,000,000,000		1,000,000,000		1,000,000,000
€1,000,000,000	CMS			101.600	%	June 28, 1999	June 28, 2029		1,000,000,000		905,000,000		905,000,000

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			Initial Public					Original Principal		Principal Amount
Title	Interest Rate(%)		Offering Price			Date of Issue	Maturity Date	Amount		Outstanding		Equivalent in euro
€1,000,000,000	CMS			100.750	%	August 30, 1999	August 30, 2019		1,000,000,000		1,000,000,000		1,000,000,000
€1,000,000,000		5.250%		99.952	%	March 10, 2000	March 10, 2005		1,000,000,000		1,000,000,000		1,000,000,000
€2,000,000,000		4.750%		99.706	%	January 23, 2001	January 23, 2006		2,000,000,000		2,000,000,000		2,000,000,000
€150,000,000	Zero Coupon			100.000	%	February 20, 2001	February 20, 2031		150,000,000		150,000,000		150,000,000
€3,000,000,000		5.750%		100.040	%	July 25, 2001	July 25, 2016		3,000,000,000		3,000,000,000		3,000,000,000
€400,000,000	3 mth libor - 0.06%			100.000	%	January 22, 2002	January 22, 2012		400,000,000		400,000,000		400,000,000
Swiss Francs(3)
ChF 300,000,000	Zero Coupon			30.873	%	December 11, 1985	December 11, 2005		300,000,000		300,000,000		193,000,515
ChF 1,000,000,000		3.250%		102.250	%	July 1, 1997	July 1, 2004		1,000,000,000		1,000,000,000		643,335,049
ChF 1,000,000,000		3.500%		102.900	%	September 25, 1998	September 25, 2008		1,000,000,000		1,000,000,000		643,335,049
ChF 1,500,000,000		3.125%		99.825	%	January 15, 1999	July 15, 2010		1,500,000,000		1,500,000,000		965,002,573
ChF 1,000,000,000	3 mth libor - 0.1%			100.060	%	March 24, 2000	March 24, 2005		1,000,000,000		1,000,000,000		643,335,049
ChF 1,000,000,000		4.000%		100.600	%	August 28, 2000	August 28, 2003		1,000,000,000		1,000,000,000		643,335,049
ChF 1,000,000,000		3.625%		100.820	%	January 10, 2001	January 10, 2006		1,000,000,000		1,000,000,000		643,335,049
ChF 1,000,000,000		3.000%		100.180	%	February 11, 2002	August 11, 2006		1,000,000,000		1,000,000,000		643,335,049
ChF 1,000,000,000		2.000%		100.470	%	January 30, 2003	April 30, 2009		1,000,000,000		1,000,000,000		643,335,049
Pounds Sterling(4)
£400,000,000		10.500%		100.875	%	April 28, 1989	April 28, 2014		400,000,000		400,000,000		577,034,045
£1,500,000,000		6.000%		98.565	%	August 4, 1998	August 4, 2028		1,500,000,000		1,500,000,000		2,163,877,669
£105,000,000	6 mth libor - 0.3%			99.700	%	May 2, 2000	May 2, 2005		105,000,000		105,000,000		151,471,437
£600,000,000	3 mth libor - 0.15%			100.000	%	March 5, 2003	March 5, 2008		600,000,000		600,000,000		865,551,068
Norwegian Kroners(5)
NOK 2,000,000,000		6.150%		100.000	%	September 25, 2002	September 25, 2012		2,000,000,000		2,000,000,000		241,152,710
NOK 2,000,000,000		4.34%		100.000	%	June 23, 2003	June 23, 2015		2,000,000,000		2,000,000,000		241,152,710
Japanese Yen(6)
¥150,000,000,000		5.125%		99.980	%	July 29, 1993	July 29, 2003		150,000,000,000		150,000,000,000		1,092,339,062
¥200,000,000,000		5.000%		99.540	%	December 15, 1994	December 15, 2004		200,000,000,000		200,000,000,000		1,456,452,083
¥125,000,000,000		5.500%		100.000	%	December 15, 1994	December 15, 2014		125,000,000,000		125,000,000,000		910,282,552
¥225,000,000,000		3.750%		100.000	%	June 8, 1995	June 8, 2005		225,000,000,000		225,000,000,000		1,638,508,593
¥125,000,000,000		4.500%		100.000	%	June 8, 1995	June 8, 2015		125,000,000,000		125,000,000,000		910,282,552
¥150,000,000,000		3.800%		100.000	%	April 4, 1996	March 27, 2008		150,000,000,000		150,000,000,000		1,092,339,062
¥100,000,000,000		3.700%		100.000	%	November 14, 1996	November 14, 2016		100,000,000,000		100,000,000,000		728,226,041
¥100,000,000,000		3.450%		99.800	%	March 24, 1997	March 24, 2017		100,000,000,000		100,000,000,000		728,226,041
¥100,000,000,000		1.800%		99.882	%	February 23, 2000	February 23, 2010		100,000,000,000		100,000,000,000		728,226,041
¥100,000,000,000		0.375%		99.936	%	October 10, 2001	October 10, 2006		100,000,000,000		100,000,000,000		728,226,041
¥100,000,000,000		0.375%		99.800	%	April 2, 2002	October 10, 2006		100,000,000,000		100,000,000,000		728,226,041
TOTAL OUTSTANDING													79,186,854,737	(7)

Source: Ministry of Economy and Finance
(1)	U.S. dollar amounts have been converted into euro at $1.1427/€1.00, the exchange rate prevailing at June 30, 2003.
(2)	External debt denominated in currencies of countries that have adopted the euro have been converted into euro at the fixed rate at which those currencies where converted into euro upon their issuing countries becoming members of the European Monetary Union.
(3)	Swiss Franc amounts have been converted into euro at ChF1.5544/€1.00, the exchange rate prevailing at June 30, 2003.
(4)	Pounds Sterling amounts have been converted into euro at £0.6932/€1.00, the exchange rate prevailing at June 30, 2003.
(5)	Norwegian Kroner amounts have been converted into euro at NOK8.2935/€1.00, the exchange rate prevailing at June 30, 2003.
(6)	Japanese Yen amounts have been converted into euro at ¥137.3200/€1.00, the exchange rate prevailing at June 30, 2003.

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(7) Italy often enters into swap agreements in the ordinary course of the management of its debt. The total amount shown above does not give effect to these arrangements. The following table summarizes the effects on the Treasury’s external bonds after giving effect to currency swaps. Total external bonds before and after swap do not include US$989 million of debt originally incurred outside Italy by FS and assumed by the Treasury by law in 1996.

	As of June 30, 2003
Currency	Before Swap			After Swap
US Dollars		49.38	%		13.72	%
Euro		24.55	%		62.38	%
Swiss Francs		7.15	%		7.41	%
Pounds Sterling		4.75	%		3.35	%
Norwegian Kroner		0.61	%		0.00	%
Japanese Yen		13.56	%		13.14	%
Total External Bonds (in millions of Euro)		€79,187			€88,391

     The total amount shown above does not include US$989 million of debt originally incurred outside Italy by FS and assumed by the Treasury by law in 1996.

     The total amount shown above does not include approximately €3,851 million outstanding under Italy’s Commercial Paper program.

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