Italy risks financial colonization, will Golden Power suffice?

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The overall market capitalization of listed Italian companies fell from 506 billion euros in 2019 to 404 billion euros in 2020.

In recent years the retreat of foreign subjects from Milan Stock Exchangegoing from 51% in June 2015 (282 billion euros) to 48% in March 2019 (246 billion euros), to drop by a further percentage point during the March 2020 sell-off (192 billion euros).

This data provides them on Study center of a company, the national union of companies that now warns of a risk of forays into Italy by “Barbarian” speculators whose sole purpose is not to invest in Italy to give stability and growth prospects to the Italian economic system, but to purely speculate, collect money and disappear leaving ruins.

The biggest risk is il Made in Italy according to the Unimprese study, which risks being scrambled by those who come to Italy without a vision but only interested in increasing their finances in the short term, for the exclusive benefit of the shareholders of their investment fund (see Pernigotti case).

Unioncamere ‘s research crossed data from Bank of Italy updated to the first quarter of 2020 with those relating to the book value of the listed and unlisted shares held by all economic entities operating in Italy.

Joint stock company in the hands of Italian families

36.55% of the corporate shares of our country are owned by families, down from 38.13% in 2019.

They follow foreigners which hold 25.21% of the equity of Italian companies, up from 24.57% in 2019.

The companies they own 15.67%, recording a slight increase compared to last year when they owned 15.37%.

In fine the banks, which are 12.08% committed but held 13.24% of the shares of Italian companies last year. Indicates that they too have divested.

The State it increased, albeit slightly, its participation with 5.17% recorded at the beginning of the year, while it was 4.68% in 2019.

Minor shares are managed by insurance companies and pension funds (2.9%) and by local administrations (0.61%).

Strategic escape of foreigners?

Focusing on the data of foreign shareholders, they have lost or sold 53.5 billion euros (-21.71%) going from 246.4 billion to 192.9 billion euros.

In Piazza Affari foreigners have the primacy with 47.69% of the shares, but they are decreasing from 51.74% in 2015. So the withdrawal of foreigners is something that precedes the pandemic and this should make us think even more.

From these data it appears that foreigners are not so interested in Italy and indeed, gradually divest. The greatest risk for Italy, perhaps, is the progressive divestment of foreigners.

General divestment from Italy or financial colonization?

And even more should worry about the general divestment that the data show, with families and banks selling shares to get rid of them.

Net of any foreign speculative raids, the most serious risk that seems to emerge from these data is the tendency to divest operated by almost all the players in the field.

The massive intervention that the Italian government seems to want to operate on some companies through the entry of Cassa Depositi e Prestitimay not be enough to make up for this generalized escape.

Italy to financial colonization risk? Perhaps most at risk of financial desertification.

This article was originally posted on FX Empire

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