18-K/A

FORM 18-K/A

Amendment No. 3

For Foreign Governments and Political Subdivisions Thereof

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

ANNUAL REPORT

of

THE REPUBLIC OF ITALY

(Name of Registrant)

Date of end of last fiscal year: December 31, 2003

SECURITIES REGISTERED*
(As of close of the fiscal year)

Title of Issues	Amounts as to which registration is effective	Names of exchanges on which registered
N/A*	N/A	N/A

Name and address of Authorized Agent of the Registrant in the United States to receive notices and
communications from the Securities and Exchange Commission:

THE HONORABLE GIOVANNI CASTELLANETA
Italian Ambassador to the United States
3000 Whitehaven Street, N.W.
Washington, D.C. 20008

It is requested that copies of notices and communications from the Securities and Exchange
Commission be sent to:

RICHARD A. ELY, ESQ
Skadden, Arps, Slate, Meagher & Flom (UK) LLP
40 Bank Street,
Canary Wharf
London E14 5DS
England

^*  The Republic of Italy files Annual Reports on Form 18-K voluntarily in order for The Republic of Italy to incorporate such Annual Reports into its shelf registration statements.

TABLE OF CONTENTS

Exhibit 1 - Recent Developments update dated January 18, 2006

     This amendment to the annual report of the Republic of Italy (the “Republic”) on Form 18-K for the year end December 31, 2003 comprises:

(a)	Pages numbered 1 to 4 consecutively.
(b)	The following exhibits:

     Exhibit 1 — Recent Developments update dated January 18, 2006.

     This amendment to the annual report is filed subject to the Instructions for Form 18-K for Foreign Governments and Political Subdivisions thereof.

2

SIGNATURE

     Pursuant to the requirements of the United States Securities Exchange Act of 1934, the registrant Republic of Italy has duly caused this Amendment No. 3 to the Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized, in Rome, Italy on the 18 day of January, 2006.

REPUBLIC OF ITALY
By:	/s/ Maria Cannata
Name:	Maria Cannata
Title:	Director General — Treasury Department — Direction II Ministry of Economy and Finance

3

EXHIBIT INDEX

Exhibit	Description	Page No.
1	Recent Developments update dated January 18, 2006

4

EX-1

Exhibit 1

Recent Developments update dated January 18, 2006

Recent Developments

Exhibit 1

Recent Developments Update Dated January 18, 2006

     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, 2003. 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

     Based on ISTAT data, Italy’s real GDP increased at a seasonally adjusted rate of 0.3 per cent in the third quarter of 2005 and grew at an annual rate of 0.1 per cent during the year ended September 30, 2005. Italy’s seasonally adjusted average unemployment rate was stable at 7.7 per cent during the second and third quarters of 2005, from 7.8 per cent during first quarter of 2005. Consumer prices, as measured by the harmonized EU consumer price index, increased at an annual rate of 2.0 per cent during the twelve months ended December 31, 2005.

Public Finance

The 2004 Stability and Growth Program

     In December 2005 Italy presented the update to its stability and growth program for the period 2005-2009 (“2005 Stability Program”) to the EU Commission. The following table compares the principal finance indicators included in the 2004 Stability Program and the 2005 Stability Program:

COMPARATIVE TABLE
2004 STABILITY PROGRAM AND 2005 STABILITY PROGRAM TARGETS

	2004		2005			2006			2007			2008
Real GDP growth rate
2004 Stability Program		1.2		2.1			2.2			2.3			2.3
2005 Stability Program		1.2		—			1.5			1.5			1.7
Difference		—		(2.1	)		(0.7	)		(0.8	)		(0.6	)
Net Borrowing, as a % of GDP
2004 Stability Program		2.9		2.7			2.0			1.4			0.9
2005 Stability Program		3.2		4.3			3.5			2.8			2.1
Difference		0.3		1.6			1.5			1.4			1.2
Public Debt, as a % of GDP
2004 Stability Program		106.0		104.1			101.9			99.2			98.0
2005 Stability Program		106.5		108.5			108.0			106.1			104.4
Difference		0.5		4.4			6.1			6.9			6.4

Source: 2005 Stability Program

Public Debt — External Bonds of the Treasury

     The following table shows the external bonds of the Treasury issued and outstanding as of December 31, 2005.

EXTERNAL BONDS OF THE TREASURY
AS OF DECEMBER 31, 2005

		Initial Public					Original Principal		Principal Amount
Title	Interest Rate(%)	Offering Price			Date of Issue	Maturity Date	Amount		Outstanding		Equivalent in euro
US$(1)
$3,500,000,000	6.875%		98.725	%	September 27, 1993	September 27, 2023		3,500,000,000		3,500,000,000		2,966,855,980
$1,500,000,000	6.025%-6.88%		100.000	%	March 5, 1996	Mar 5, 2004/12		1,500,000,000		1,500,000,000		1,271,509,706
$750,000,000	5.81%-6,70%		100.000	%	March 5, 1996	Mar 5, 2002/10		750,000,000		750,000,000		635,754,853
$1,500,000,000	5.97% -6.25%		100.000	%	December 20, 1996	Dec 20, 2004/12		1,500,000,000		1,500,000,000		1,271,509,706
$2,500,000,000	6.000%		99.755	%	May 29, 1998	May 29, 2008		2,500,000,000		2,500,000,000		2,119,182,843
$2,000,000,000	6.000%		99.274	%	February 22, 2001	February 22, 2011		2,000,000,000		2,000,000,000		1,695,346,274
$2,000,000,000	5.250%		99.506	%	April 5, 2001	April 5, 2006		2,000,000,000		2,000,000,000		1,695,346,274
$3,000,000,000	4.375%		99.468	%	October 25, 2001	October 25, 2006		3,000,000,000		3,000,000,000		2,543,019,412
$2,000,000,000	4.375%		98.007	%	January 28, 2002	October 25, 2006		2,000,000,000		2,000,000,000		1,695,346,274
$2,000,000,000	5.625%		99.893	%	March 1, 2002	June 15, 2012		2,000,000,000		2,000,000,000		1,695,346,274
$1,000,000,000	5.625%		99.392	%	May 8, 2002	June 15, 2012		1,000,000,000		1,000,000,000		847,673,137
$300,000,000	3 mth libor - 0.065%		100.000	%	August 1, 2002	August 1, 2007		300,000,000		300,000,000		254,301,941
$3,000,000,000	3.625%		99.721	%	September 4, 2002	September 4, 2007		3,000,000,000		3,000,000,000		2,543,019,412
$3,000,000,000	2.500%		99.767	%	January 30, 2003	March 31, 2006		3,000,000,000		3,000,000,000		2,543,019,412
$2,000,000,000	5.375%		98.436	%	February 27, 2003	June 15, 2033		2,000,000,000		2,000,000,000		1,695,346,274
$2,000,000,000	4.375%		99.694	%	February 27, 2003	June 15, 2013		2,000,000,000		2,000,000,000		1,695,346,274
$1,250,000,000	3.25%		99.949	%	May 6, 2003	May 6, 2008		1,250,000,000		1,250,000,000		1,059,591,422
$2,000,000,000	99.52%		99.521	%	July 3, 2003	July 15, 2008		2,000,000,000		2,000,000,000		1,695,346,274
$3,000,000,000	2.75%		99.901	%	November 13, 2003	December 15, 2006		3,000,000,000		3,000,000,000		2,543,019,412
$100,000,000	4.17%		100.000	%	November 14, 2003	November 15, 2010		100,000,000		100,000,000		84,767,314
$100,000,000	4.06%		100.000	%	December 9, 2003	December 9, 2010		100,000,000		100,000,000		84,767,314
$2,000,000,000	2.75%		100.239	%	January 14, 2004	December 15, 2006		2,000,000,000		2,000,000,000		1,695,346,274

		Initial Public						Original Principal		Principal Amount
Title	Interest Rate(%)	Offering Price			Date of Issue		Maturity Date	Amount		Outstanding		Equivalent in euro
$2,000,000,000	3.25%	99.515	%	March 3, 2004		May 15, 2009			2,000,000,000		2,000,000,000		1,695,346,274
$2,000,000,000	3.75%	99.783	%	June 30, 2004		December 14, 2007			2,000,000,000		2,000,000,000		1,695,346,274
$4,000,000,000	4.50%	99.411	%	January 21, 2005		January 21, 2015			4,000,000,000		4,000,000,000		3,390,692,549
$3,000,000,000	4.00%	99.932	%	May 9, 2005		June 16, 2008			3,000,000,000		3,000,000,000		2,543,019,412
Euro(2)
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
567,225,000	6.250%	100.790	%	May 29, 1997		May 29, 2012			567,225,000		567,225,000		567,225,000
762,245,000	5.875%	101.594	%	July 2, 1997		July 2, 2007			762,245,000		762,245,000		762,245,000
1,533,870,000	5.750%	101.663	%	July 10,1997		July 10, 2007			1,533,870,000		1,533,870,000		1,533,870,000
60,000,000	FRN/FX	99.610	%	October 8, 1998		October 8, 2018			60,000,000		60,000,000		60,000,000
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	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
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
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
1,000,000,000	3 mth eubor - 0.06%	100.000	%	July 24, 2003		January 24, 2007			1,000,000,000		1,000,000,000		1,000,000,000
150,000,000	84.5% cms 10Y	100.000	%	April 26, 2004		April 26, 2019			150,000,000		150,000,000		150,000,000
300,000,000	12 mth eubor + 0.10%	100.000	%	May 31, 2005		May 31, 2035			300,000,000		300,000,000		300,000,000
720,000,000	3.546% until 2009	100.000	%	June 2, 2005		June 2, 2029			720,000,000		720,000,000		720,000,000
395,000,000	3.523% until 2010	100.000	%	June 2, 2005		June 2, 2030			395,000,000		395,000,000		395,000,000
200,000,000	85% * 10y Eurswap	100.000	%	June 8, 2005		June 8, 2020			200,000,000		200,000,000		200,000,000
2,500,000,000	85% * 10y swap rate	100.000	%	June 15, 2005		June 15, 2020			2,500,000,000		2,500,000,000		2,500,000,000
300,000,000	85.5% * 10y swap rate	100.000	%	June 28, 2005		June 28, 2021			300,000,000		300,000,000		300,000,000
200,000,000	6m Eur + 1.5% (max 10X (cms10-cms2)	100.000	%	November 9, 2005		November 9, 2025			200,000,000		200,000,000		200,000,000
Swiss Francs(3)
ChF 1,000,000,000	3.500%	102.900	%	September 25, 1998		September 25, 2008			1,000,000,000		1,000,000,000		643,045,463
ChF 1,500,000,000	3.125%	99.825	%	Jan 15,1999		July 15, 2010			1,500,000,000		1,500,000,000		964,568,195
ChF 1,000,000,000	3.625%	100.820	%	January 10, 2001		January 10, 2006			1,000,000,000		1,000,000,000		643,045,463
ChF 1,000,000,000	3.000%	100.180	%	February 11, 2002		August 11, 2006			1,000,000,000		1,000,000,000		643,045,463
ChF 1,000,000,000	2.000%	100.470	%	January 30, 2003		April 30, 2009			1,000,000,000		1,000,000,000		643,045,463
ChF 1,000,000,000	2.000%	99.775	%	August 11, 2003		February 9, 2007			1,000,000,000		1,000,000,000		643,045,463
ChF 1,000,000,000	1.750%	100.09	%	February 3, 2004		March 3, 2008			1,000,000,000		1,000,000,000		643,045,463
ChF 1,000,000,000	2.750%	100.625	%	July 1, 2004		July 1, 2011			1,000,000,000		1,000,000,000		643,045,463
ChF 2,000,000,000	2.500%	100.090	%	February 2, 2005		March 2, 2015			2,000,000,000		2,000,000,000		1,286,090,927
Pounds Sterling(4)
£400,000,000	10.500%	100.875	%	April 28, 1989		April 30, 2014			400,000,000		400,000,000		583,685,977
£1,500,000,000	6.000%	98.565	%	August 4, 1998		August 4, 2028			1,500,000,000		1,500,000,000		2,188,822,414
£600,000,000	3 mth libor - 0.15%	100.000	%	March 5, 2003		March 5, 2008			600,000,000		600,000,000		875,528,965
£250,000,000	5.25%	99.476	%	July 29, 2004		December 7, 2034			250000000		250000000		364,803,736

		Initial Public					Original Principal		Principal Amount
Title	Interest Rate(%)	Offering Price			Date of Issue	Maturity Date	Amount		Outstanding		Equivalent in euro
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		250,469,631
NOK 2,000,000,000	4.340%		100.000	%	June 23, 2003	June 23, 2015		2,000,000,000		2,000,000,000		250,469,631
Japanese Yen(6)
¥125,000,000,000	5.500%		100.000	%	December 15, 1994	December 15, 2014		125,000,000,000		125,000,000,000		899,928,006
¥125,000,000,000	4.500%		100.000	%	June 8, 1995	June 8, 2015		125,000,000,000		125,000,000,000		899,928,006
¥150,000,000,000	3.800%		100.000	%	April 4, 1996	March 27, 2008		150,000,000,000		150,000,000,000		1,079,913,607
¥100,000,000,000	3.700%		100.000	%	November 14, 1996	November 14, 2016		100,000,000,000		100,000,000,000		719,942,405
¥100,000,000,000	3.45%e		99.800	%	March 24, 1997	March 24, 2017		100,000,000,000		100,000,000,000		719,942,405
¥100,000,000,000	1.800%		99.882	%	February 23, 2000	February 23, 2010		100,000,000,000		100,000,000,000		719,942,405
¥100,000,000,000	0.375%		99.936	%	October 10, 2001	October 10, 2006		100,000,000,000		100,000,000,000		719,942,405
¥100,000,000,000	0.375%		99.800	%	April 2, 2002	October 10, 2006		100,000,000,000		100,000,000,000		719,942,405
¥100,000,000,000	0.650%		99.995	%	April 14, 2004	March 20, 2009		100,000,000,000		100,000,000,000		719,942,405
Australian Dollar(7)
A$1,000,000,000	5.880%		99.803	%	February 27, 2004	August 14, 2008		1,000,000,000		1,000,000,000		620,770,998
TOTAL OUTSTANDING												83,707,043,091	(8)

(1)	U.S. dollar amounts have been converted into euro at $1.1797/€1.00, the exchange rate prevailing at December 30, 2005.
(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 ChF1.5551/€1.00, the exchange rate prevailing at December 30, 2005.
(4)	Pounds Sterling amounts have been converted into euro at £0.6853/€1.00, the exchange rate prevailing at December 30, 2005.
(5)	Norwegian Kroner amounts have been converted into euro at NOK7.985/€1.00, the exchange rate prevailing at December 30, 2005.
(6)	Japanese Yen amounts have been converted into euro at ¥138.9/€1.00, the exchange rate prevailing at December 30, 2005.
(7)	Australian Dollar amounts have been converted into euro at A$1.6109/€1.00, the exchange rate prevailing at December 30, 2005.
(8)	The amount of external bonds shown above does not take into account the effect of currency swaps that Italy often enters into in the ordinary course of the management of its debt. The following table summarizes the effects on the Treasury’s external bonds after giving effect to currency swaps.

	As of December 31, 2005
Currency	Before Swap			After Swap
US Dollars		52.15	%		8.60	%
Euro		25.05	%		70.30	%
Swiss Francs		8.07	%		8.69	%
Pounds Sterling		4.79	%		3.41	%
Norwegian Kroner		0.60	%		—
Japanese Yen		8.60	%		9.00	%
Australian Dollar		0.74	%		—
Total External Bonds (in millions of Euro)		€83,707			€88,637

Source: Ministry of Economy and Finance

Other Developments

     As previously described in the Recent Developments Update dated November 8, 2005, filed under cover of Form 18-K/A no. 2 on November 16, 2005, with reference to the IRAP case pending before the ECJ, in order to avoid material adverse effects on Italy’s regional finances, the EU Advocate General requested that the ECJ limit the effects of its ruling from a temporal standpoint by reference to a fixed date. A hearing on this matter was held in December 2005.

     In September 2005, securities litigation was commenced against the Republic of Italy and a number of investment banking firms in the U.S. District Court for the Southern District of New York. This litigation, which sought class action status, alleged among other things that the registration statements used by the Republic of Italy in connection with its issuance of approximately $25 billion of debt securities between September 2002 and April 2005 contained certain misrepresentations and omissions relating to the size of Italy’s historical budget deficits and the amount of Italy’s debt as a

     percentage of gross national product. In this action, the plaintiff claimed an unspecified amount of compensatory damages, plus costs and fees.

     On January 9, 2006, the plaintiff entered a notice of voluntary dismissal without prejudice in respect of this lawsuit. Pursuant to the U.S. Federal Rules of Civil Procedure, any action dismissed without prejudice may be refiled at any time by the same or by a different plaintiff.

     It is not possible to predict whether this litigation will be refiled. However, as the Republic of Italy believes that it has valid defenses to these claims, even if this action is re-commenced, the Republic of Italy does not expect that this matter will have a material adverse effect on its financial position.