Italian Prime Minister Silvio Berlusconi said he would spur the economic growth of the country ahead of the 2006 general election.

Silvio Berlusconi won a confidence vote in his government for the Action Plan for Growth that was approved in the upper house but is still in progress as to the ratification by the lower house of the parliament.

The economic growth for Italy, the EU nation with the most sluggish economy over the last 10 years, is forecast at 1.2%, down from a previous target of 2.1%. The debt and deficit forecasts were raised.

Berlusconi’s plan to push the economy comes from last month’s pressure upon Berlusconi who resigned to form a new government and keep power at least till the next elections in 2006.

Under the new plan, the welfare will be reformed and red tape slashed. The move is targeted at small businesses that are struggling in competition with companies from Asia and Eastern Europe.