In the last decade, the trade between the countries of the Gulf area has increased significantly, exceeding 1680 trillion dollars in 2013. Based on the data published by the Intesa Sanpaolo Study Centre, trade would be below 1600 billion in 2014, with a contraction of about 5%. The sectoral detail of exports shows the absolute importance of energy products (for a percentage equal to 83% in 2014), followed by chemical products (4%), rubber and plastic (3,5%), stones, glass and ceramics (3%) and metals (3%). Significant imports include machinery (with a percentage of around 25%, means of transport (15%), agri-food products (11%), stones, glass and ceramics (9%), metals (9 %) and minerals (8%).
In fact, even the structural and operational characteristics of the banking systems of the Gulf countries are still closely linked to oil. Loans and deposits are conditioned by the evolution of public financial resources and therefore of public spending. In addition, states or government agencies hold more or less significant stakes in many banks. After years of sustained growth in all countries, between 5% (in the Emirates at the end of 2012) and 22% (in Qatar), up to the first months of 2014, the trend in total loans then differentiated between the partners of the region. Loans to households are mainly to workers in the public sector, whose salary has not been conditioned by the trend in the price of oil, while corporate loans are destined above all to the construction sector. The quality of the assets is high, with a low bad loans/lending ratio, which are between 1% in Saudi Arabia and 7% in the Emirates, very low levels by international comparison. However, some relevant risk factors remain. First of all, the high degree of risk concentration, defined on the basis of the number of borrowers, large conglomerates often of a family nature: this is a risk of a structural nature, the overcoming of which does not seem possible in the short term.
Even deposits, which represent the main source of funding, are affected by the variability of public resources. In 2015, their performance diverged: decelerating especially in the Emirates (+1,3% in September) and Saudi Arabia (+7,7% in August). Very dynamic in Oman, where deposits are expected to remain buoyant in the medium term thanks to the growing population, with many young people still unbanked. The strengthening of household deposits will then be able to contribute to the stability of funding. In any case, the banking systems of the Gulf countries are currently well positioned to face a drop in the price of oil in the coming years, although liquidity conditions, still high, are tightening and rates are expected to rise. The main drivers that can support the further expansion of banking systems both with reference to product diversification, both in assets and liabilities, are expected population trends and growing economic diversification.
The capital asset ratio is very high in Kuwait and Bahrain, both with an indicator of 18,3% at the end of 2014, and in the Emirates (18,1%), although down compared to 2013. Profitability benefits from the low cost of funding (since current accounts do not offer interest), high efficiency and a favorable tax regime. The ROA in Saudi Arabia and Qatar exceeded 2% in 2014. In the Emirates, Oman and Kuwait the ratios are more contained (between 1% and 2%). Relations with foreign countries are modest, both with reference to operations (foreign assets and liabilities) and to equity interests. In recent years, some banks, especially in Qatar and the UAE, have pursued a strategy of territorial expansion towards North Africa. Islamic finance, which covers about 25% of the system's Total Asset (TA), has shown a very dynamic trend, particularly in Qatar (with an average annual growth rate between 2009 and 2014 of +21%) and in Saudi Arabia (+13,4%). The return in Qatar was also very high (ROA averaged 2,28% per year). In Saudi Arabia, the ROA was 2,4% in the period considered.
In this context, Italian trade with the Gulf countries has grown significantly in the last five years reaching in 2011 a total of approximately 31 billion euro (+12% annual average since 2006). In 2014 trades recorded a decline (-8%), returning in absolute terms to about 25 billion dollars, due to a significant contraction of Italian imports (-17%) and to a lesser extent exports (-0,7%). The weight of trade in the Gulf countries in 2014 on the Italian trade balance is 3,3%. In the first seven months of 2015, exchanges returned to growth (+9,5%). In particular, exports increased (+15%) to 9,5 billion euro, while imports showed a more contained increase, equal to 1%, to 5,6 billion.
The stock of FDI in the Gulf countries in 2014 was even, based on data UNCTAD, to approximately 483 billion dollars, up by more than 50% on 2009. Of the global total, the markets considered represent approximately 1,96% (it was 1,8% in 2009). The stock of outgoing FDI in 2014 was close to 207 billion (about 0,8% of the world total). Some countries in the region are planning concessions and incentives for FDI in the Special Economic Zones, with the application of reduced tax rates and bureaucratic and administrative facilities, as well as financial ones.
In 2014, Italy mainly imported minerals (75%), especially crude oil and natural gas, but also chemical products (8%), especially organic chemical products and plastic materials, metals and metal products (5%), refined petroleum products (5%), other manufacturing activities. Italian exports mainly concerned machines and mechanical machinery (30%), various artifacts (14%), metals and metal products (8%), refined petroleum products (8%), electrical appliances (7%). The trade balance is positive for Italy and equal in 2014 to approximately 4,7 billion euros. However, there are differences by country: while the balance with Iraq and Qatar is clearly negative (in 2014 respectively -2,2 and -0,1 billion), due to the importance of energy mineral imports from these two countries, there is a surplus against the UAE (+4,7 billion), Saudi Arabia (+0,6 billion), Kuwait (+0,6 billion), Oman (+0,4 billion) and Bahrain (+0,2 bln). Trade with Iran (with a positive balance of +0,7 billion) was affected by the sanctions regime still in force. Finally, looking at the shares on the Italian sectoral balances of imports and exports, the Gulf countries cover about 16% of imports of mineral products, around 9% and 8% of exports, respectively, of various manufactured goods and refined petroleum products, 6% of mechanical machinery and over 5% of electrical machinery. The Ministry of Foreign Affairs reports investment opportunities in the sectors of capital goods, construction and infrastructure, luxury goods and typical Made in Italy products.
