Italy’s economy has held up better than expected against a string of recent global shocks, according to a new OECD assessment — though the organization is flagging some familiar long-term worries: high public debt, an aging population, and growing exposure to global trade and energy risks.

Growth is projected to stay modest, around 0.5% for 2026, as a renewed spike in energy prices weighs on household spending, investment, and exports. That’s expected to offset some of the boost coming from Italy’s National Recovery and Resilience Plan, the EU-backed reform and investment program that’s been a central pillar of the country’s post-pandemic economic strategy.

The debt picture remains the most persistent challenge. Italy’s public debt sits near 150% of GDP — among the highest in the OECD — pushing up borrowing costs and squeezing the government’s room to invest in infrastructure or ease the tax burden on households and businesses.

There’s a labor market angle too: Italy continues to struggle with getting young people and women into the workforce at rates seen elsewhere in Europe, a gap the OECD says is holding back the country’s overall growth potential. Reforms are underway, but the report notes progress has been gradual.

On a more positive note, fiscal consolidation efforts already in motion have helped lower interest rate spreads compared to other euro-area economies, giving Italy somewhat steadier footing than it’s had in past crises.

The bottom line from the OECD: Italy isn’t in danger, but its longer-term growth path still depends heavily on following through on reforms it’s already started.