North Africa has a bigger place in the map of Italian investments abroad. The mission of the Italian government in two Maghreb countries, Algeria and Morocco, will bring results only in the coming months, but has offered interesting perspectives of new opportunities (with some risks) in this area of the Mediterranean.
Production sites for the automotive industry, the renegotiation of gas contracts, and infrastructure investments were the three issues debated between Italy and Algeria, while opportunities for renewable energies and machine tools could soon materialize in Morocco.
Economic Development Minister Federica Guidi has a double goal: confirming Italy’s relatively strong position in Algeria and boost opportunities in Morocco, where Italian businesses lag competitors from France and Spain.
The mission, which has seen the participation of Ice - Italian Trade Agency, Cassa depositi e prestiti, SACE and Simest, served to better understand the importance of a public financial arm to support companies abroad.
The new project is named Exim Bank. “It aims to increase our presence abroad through a single financial vehicle,” the minister said. “I believe that we will be ready by the end of the year.”
Funding from state-backed lender CDP, the guarantees offered by SACE and equity from Simest could be integrated in a stronger subject specialized in credit to export, modeled on the experience of the main European countries.
Italy has long worked amid several difficulties on the project, which awaits a valuation by the Bank of Italy in terms of supervision.
As for the mission in Maghreb, Italy’s trade ties with Algeria have inevitably suffered from a drop in oil prices and the ensuing change in the domestic scenario. Oil sales account for 60% of Algeria’s national revenues, 30% of GDP and 97% of export revenues. The falling oil prices will therefore impact investments and private consumption, as well as some government decisions in terms of industrial policy.
“It is also true that this is gradually leading to a diversification of foreign investments in the country, with new potential opportunities opening,” Guidi said. Productive investments by Fiat Chrysler, Iveco and Piaggio are in the cards.
Oil uncertainty does not concern Morocco. Here, however, Italy needs to regain the lost ground. Italy is the seventh-largest trade partner of the country and its ninth investor, lagging behind two big European partners, France and Spain. But the scenario could turn particularly favorable. “We have laid the foundations for a significant growth in the country,” Guidi said. “We will create a mixed task force to implement the first projects, perhaps already in the beginning of the next year when a new bilateral summit is expected.” Renewable energies and agricultural equipment are the main fields where Italy aims to invest.
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