Italy signs deals worth $2.8 billion with China

ROME: Italy signed a preliminary accord with China on Saturday that makes it the first country of the Group of Seven industrialised nation to join the Chinese Belt and Road infrastructure project.

Around 30 parallel deals were signed on the sidelines of the visit to Rome by Chinese President Xi Jinping, including 10 with Italian companies and others with ministries and public bodies.

Italian Deputy Prime Minister Luigi Di Maio said the deals were worth an initial 2.5 billion euros ($2.8 billion) but had a potential value of 20 billion.

Here are details of some of the accords.

Italy’s state lender Cassa Depositi e Prestiti (CDP) signed an agreement with Bank of China to let it sell “Panda” bonds - debt sold by foreign entities to investors in mainland China. CDP said it will issue bonds worth 5 billion renminbi ($744.5 million). CDP and Bank of China will also co-finance Italian companies for 4 billion renminbi. A CDP official told Reuters on Friday that the first tranche of Panda bonds will be issued in the coming weeks.

CDP and Italian gas company Snam have signed a memorandum of understanding with the Chinese Silk Road fund (SRF) for cooperation on international investments in China and in the about 120 countries that have already signed up for the Belt and Road Initiative (BRI).

Snam and SRF said they will consider possible cooperation in the natural gas sector − pipelines, storage facilities, LNG infrastructure and biomethane plants.

Italian metals company Danieli has signed a deal to build part of a steel plant in China that will then be transferred to Azerbaijan.

China Communications Construction Company (CCCC) has signed two cooperation agreements with the authorities of Trieste’s port and with the commissioner supervising the reconstruction of the bridge of Genoa that collapsed last year.

Daimler has asked Goldman Sachs to help it explore increasing its stake in Chinese carmaker BAIC Motor Corp, its main China joint venture partner, two people with knowledge of the matter said. A deal would be only the second since the world’s biggest auto market relaxed foreign ownership rules last year.

Daimler’s rival BMW became the first to take advantage of the changes when it agreed in October to buy control of its venture with Brilliance China Automotive Holdings Ltd for 3.6 billion euros ($4.08 billion).

Caps on foreign ownership previously prevented overseas carmakers from controlling any Chinese maker or joint venture with foreign peers. Last year those limits were removed for firms making fully electric and plug-in hybrid vehicles, which will be followed in 2020 by the removal of limits on makers of commercial vehicles such as trucks and buses.

Ansaldo Energia said it signed a deal with China United Gas Turbine Company (UGTC) for technology cooperation in the field of heavy duty gas turbines.

Ansaldo Energia has also been awarded a contract worth approximately 25 million euros to supply a AE94.2K gas turbine and syngas compressor train for Bengang combined cycle power plant, located in Benxi in the northeast China.

China’s e-commerce group Suning, top shareholder of Italian Serie A football team Inter Milan, announced a deal with the Italian Trade Agency to boost Made-in-Italy exports to China.

Intesa Sanpaolo has signed a MoU with the Chinese city of Qingdao to develop wealth management services for local clients through a wholly-owned company called Yi Tsai. Intesa aimed to sell its own financial products in Qingdao in the near future, Intesa CEO Carlo Messina said. Italian energy giant Eni has signed a MoU with Bank of China to secure a credit line. Italy’s railways group Ferrovie dello Stato, Atlantia’s airport operator Aeroporti di Roma and the museums of sports car maker Ferrari have signed a commercial deal with China’s biggest online travel agency Ctrip to develop Chinese tourism in Italy.

Italy on Saturday signed a “non-binding” protocol with China to take part in Beijing’s new “Silk Road” of transport and trade links stretching from Asia to Europe.

In doing so, Italy became the first G7 country to sign up for the massive project, which has sparked unease in the US and the European Union as China aspires to a greater world role.

Visiting Chinese President Xi Jinping and Italian Prime Minister Giuseppe Conte both attended a ceremony for the signing of 29 memoranda of understanding, which Italian media said were worth 5.0 to 7.0 billion euros ($5.6 to 8.0 billion).

Also signing the accords were the chairman of China’s chairman National Development Commission He Lifeng, and Italian deputy prime minister Luigi Di Maio, who also holds the economic development portfolio.

After a brief meeting with Conte, Xi and his wife Peng Liyan flew to Palermo, Sicily for a private visit to the Palazzo dei Normanni.

Agencies