Banks, workers, companies devoted to exports. The Italian government is preparing two decrees to protect all categories at risk in the event of hard Brexiti.e. in the event that Great Britain leaves the European Union without a deal. Despite the vote of the London Parliament in favor of a postponement to attempt a further round of negotiations, in fact, the chaos over Brexit reigns supreme and all scenarios are still open.
According to a confidential draft reported by Corriere della Sera, one of the provisions contains “urgent measures to guarantee financial stability and market integrity”, to protect “the economic, banking and insurance system” national and protect “investors and customers”, maintaining “continuity in services” and guaranteeing a “Orderly release of UK subjects”, which would stop “operating in the Italian territory”. A traumatic break, which one would like to mitigate with a "transitional phase", from six to eighteen months, "before the cessation of activity".
The stakes are really high. Based on the reports of the interministerial coordination table set up by the Prime Minister - a sort of crisis unit which also made use of studies prepared by other institutes, such as ISPI and the Confindustria Study Center - in addition to the risk associated with the 'increase in the spread, impossible to predict, in the event of a hard Brexit Italy would also have to face a serious occupation problem. The British subsidiaries active in our country, in fact, they employ 85 people and produce an annual turnover of approximately 35 billion euros, 9,5% of the revenues produced by all the multinationals present in Italy.
For the banks, the draft of the first decree provides for a "scheme for granting state guarantees on the securitization of non-performing loans".
However, there would also be another decree, currently being drafted, which aims to protect companies exporting to the UK. On this front, the discussion is particularly broad, because Great Britain represents a trading partner of primary importance for Italy.
In 2017 (latest data available) companies in our country exported products to the United Kingdom for 23 billion euros, about 5% of all Italian exports. With the hard Brexit, Great Britain would suddenly leave the single European market and trade with London would fall under the rules – much less advantageous – of the World Trade Organization. This means that, at least in the immediate term, many Italian companies risk going into crisis, because among theintroduction of duties and the predictable devaluation of the pound our country's products would suddenly become much less competitive.
They would also skip the “geographical and quality indications”, which would no longer be recognized or protected: the problem – according to Coldiretti – would concern about 30% of Made in Italy agri-food exports, “which without European protection risk suffering unfair competition from imitation products from non-EU countries”.
According to reports, the sector most at risk is that of wines and alcoholic beverages: in this sector, Italy exports products to the United Kingdom for more than one billion euros a year, about 12% of the total. The protagonist of a recent boom is the Prosecco Dop: 50% of Italian bottles destined for the foreign market end up on British soil, for a total value of 348 million euros.
The sectors of theagri-food, which exports to the UK for 2,6 billion dollars (7,8%) and del fresh, which would be seriously affected by the delays caused by the reintroduction of customs controls. The prices of dairy product, on the other hand, would rise by 35% due to the new tariffs.
In detail, Coldiretti informs that - in the event of a no deal - duties of 24,9 euros per quintal would be imposed on all types of grated cheese, including Grana Padano and Parmigiano Reggiano, which alone produced a turnover of 85 million euros in 2018.
The crisis, however, would come later a record year for Italian food exports to the UK, which, according to Istat, in 2018 reached 3,4 billion euros.
The tariff increases would also affect the export of machinery (4,3 billion dollars), motor vehicles (2,9 billion dollars), clothing (2,1 billion) e furnishings (1,3 billion).
Still on the industrial side, there are also the interests of Leonardo, which has six factories between England and Scotland and employs 7.100 people, with ancillary activities of 2.300 companies and revenues of 2,3 billion pounds. With the hard Brexit, the supplies of materials would risk being delayed, which could cause delays in the delivery times foreseen by the contracts.
