ROME (REUTERS) - Italy will ramp up spending to help the economy cope with the impact of the coronavirus, earmarking €25 billion (S$39.4 billion) to tackle the growing crisis, Prime Minister Giuseppe Conte said on Wednesday (March 11).

Last week, the Cabinet said it would need just €7.5 billion, but since then, the emergency has escalated dramatically and the entire nation is under lockdown, freezing much economic activity in a nation that was already flirting with recession.

Mr Conte warned that already tough restrictions on movement might be tightened further after the northern region of Lombardy asked for all shops to shut and public transport to close.

"We are ready to listen to requests from Lombardy and other regions," he told a news conference, adding that caution would be needed before deciding to introduce fresh measures.

"The main objective is to protect citizens' health, but we must take into account that there are other interests at stake. We must be aware that there are civil liberties that are being violated, we must always proceed carefully," he said.

Italy is the worst-affected country in the world after China, with some 631 deaths and 10,149 confirmed cases since the contagion came to light in Lombardy on Feb 21.

The extra spending means Italy's 2020 budget deficit looks certain to climb above 3 per cent of national output, the ceiling set by the European Union's rules.

Economy Minister Roberto Gualtieri, who last week forecast a deficit of 2.5 per cent, declined on Wednesday to give a new target.

He said that Rome might need help from European Union funds to take some of the burden off Italy.