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ROME, Dec 19 (Reuters) - Italy's main business lobby group Confindustria warned on Thursday that the country was "on a razor's edge", facing an increasing risk of social breakdown despite signs that its two-year recession was coming to an end.
Confindustria, which represents almost 150,000 Italian companies, cut its estimate for 2013 gross domestic product on Thursday to show a contraction of 1.8 percent, compared with a previous estimate of a 1.6 percent fall but forecast a small recovery next year.
"The major risk is a breakdown in social cohesion with an increase in protest movements channelled by groups urging disobedience and the subversion of institutions," the group's economic forecasting arm said.
It said it expected growth of 0.7 percent in 2014, picking up to 1.2 percent in 2015 though it said that under an unfavourable scenario growth might only reach 0.4 percent next year and remain flat in 2015.
The comments from the main lobby of Italian business underline growing concern at the threat of social tension in the eurozone's third largest economy which has seen sporadic anti-government demonstrations over the past two weeks.
Financial markets have calmed since the height of the euro zone crisis when Italy was on the brink of defaulting on its huge public debt but the tough austerity measures imposed to control public finances have caused widespread resentment.
Confindustria forecast that Italy's deficit to GDP ratio would come in at 3 percent in 2013, just in line with European Union borrowing limits, falling to 2.7 percent in 2014 and 2.4 percent in 2015.
It said public debt would reach 132.6 percent of GDP this year, compared with a previous estimate of 131.7 percent and said it would rise further to 133.7 percent in 2014 before easing to 132 percent in 2015. (Reporting by Antonella Cinelli; writing by James Mackenzie; editing by Patrick Graham)