20 Novembre 2012
“A growing bilateral partnership between Italy and UAE: from the focus on foreign trade to the focus on investments and joint ventures”
20 November 2012
Your excellences Minister of Economy Sultan Al Mansouri and Chairman of the Chamber of Commerce Abdulrahman Saif Al Ghurair, ladies and gentlemen, let me say how happy I am to be in this dynamic and spectacular city today.
I will say a few words on the situation of the euro area and of Italy before moving on to the subject of the conference - as I'm sure this may be playing on your mind.
The euro area is overcoming its crisis. More than a currency the euro is a symbol of European integration that European governments are determined to preserve and strengthen.
In the last six months we have stabilized financial markets by implementing a powerful and permanent rescue fund, the European Stability Mechanism. The European Central Bank, for its part, has put in place a bond buying programme to ensure governments' financing costs reflect their economic fundamentals and reform efforts. Next month we will adopt a concrete roadmap to reinforce the architecture of our Economic and Monetary Union starting with a single supervision mechanism for banks to make sure we spot and deal with problems earlier in the future.
Governments are reducing budget deficits where they were inflated by the bursting of a housing bubble or the need to recapitalize systemic banks, or both, following the fall of Lehman Brothers in 2008 and the ensuing recession. Italy was not afflicted by any of these evils, but as the financing costs increased significantly my government in the last 12 months moved swiftly to bring the country to safe ground by putting the debt on a descending trajectory and enhancing the business environment.
I am convinced the budgetary consolidation and reform efforts going on in the euro area as well as the reinforcement of the EMU architecture will see us emerging stronger soon. With a budget deficit below 3% this year and structural balance next year, which means a primary surplus of around 5%, Italy's public finances are healthy. The same can be said of the euro area aggregate figures. Compare, for example, with the situation in the UK, the US or Japan. The markets have started to notice and are coming back to Italy.
Moving now to the subject of my visit, I'm happy to note the high level of our relations. The United Arab Emirates are our most important trading partner among all the Arab countries. Italian exports to the UAE increased 28% in 2011 to a total of €4,7 billion and we are likely to do even better in 2012 given the results from the first six months (€3.2 billion). Italy's imports from the UAE remain limited but they nearly doubled in 2011, so this is clearly a win-win situation that we must set to expand in other fields.
Emirati investors and consumers are familiar with the excellence of Italian companies and products, as I can see from the evidence of luxury cars and other goods as well as the restaurants serving our gourmet food. Rail transportation is being developed by Italian companies, Italian helicopters and planes criss-cross the Emirati skies, our companies are active in water desalination and your main steel plant is being built by an Italian contractor. The beautiful Mosque of Abu Dhabi is also testimony of the reputation of Italy's architects and craftsmen.
In other words you are well aware of the enormous diversity and strength of Italian companies, including our agile, highly innovative and professional small and medium enterprises that are the country's economic backbone.
I am convinced that despite the already very significant results, the potential of our cooperation is not fully exploited yet. The affinity between the Italian and the Arab culture is very strong, and Emirati investors are welcome to Italy to make this partnership even stronger and bigger.
I see room for an increase of investments to which you are very much welcome.
With their innovative know-how, high export growth and established international reputation, Italian SMEs are natural partners for UAE investors.
I strongly believe UAE foreign investment strategies would gain from becoming more diversified and less dependent on traditional destinations.
The leadership of this country took the wise decision to diversify the economy away from the previous reliance on oil and gas.
The UAE is now very successfully focused on the service and manufacturing sectors, which are the areas where we see the highest potential in our cooperation.
Italy's specialized manufacturing districts are models of cluster development. Investment in them would help the UAE economy become even more independent from oil and gas, and advance the government objective of achieving a greater focus on a knowledge based economy.
Our friend Sultan Al Mansouri visited Italy recently and has first-hand knowledge of our productive reality.
In the last 12 months my government has taken a number of steps to further improve the business environment. The reform package has significantly reduced red tape and modernized the public administration, strengthened the legal framework, increased competition and made the labour and economic in general more flexible and dynamic. The OECD recently estimated the reforms will add 4 percentage points to Italy's GDP over 10years.
Now let me turn to the Italian presence in the UAE. Italian companies need to further explore the opportunities offered by the dynamic economy here in the UAE. We are not talking about relocating production capacity but rather strengthening a consolidated presence in the UAE. This can help the overall growth of the Italian companies, boosting their home base and main production facilities in Italy.
This country, and especially Dubai, is a natural hub for serving the Middle East, Africa and Asia.
The development of a more structured presence here would allow Italian companies and their Emirati partners to establish a more effective base to serve the vast markets of those macro-regions.
We have to exploit the complementarily of our two economic systems. Synergy and co-investments between Italy and UAE should become a by-word for the development of initiatives in the GCC market but also in third countries, especially in North Africa.
This is the way ahead, this is the strategy we define as crucial for the future. We can help this process by removing the institutional obstacles to this natural development and providing an effective legal, financial and regulatory framework for business.
To conclude let me restate that our countries share a common vision and approach on many of the significant issues and challenges of our times. Deeper integration and closer cooperation are at the heart of the strategic partnership between Italy and UAE. This partnership will, for the first time, be officially enshrined in the text of the Joint Declaration which provides official recognition that our relationship has moved to a new level. It represents a commitment to our future which I will have the honor to sign later today with Vice President and Prime Minister His Highness Shaikh Mohamed Bin Rashid al Maktoum.
Thank you.
