A survey of Italy’s economy tells a grim story. The country is now in its fourth recession since 2001. Manufacturing is in free fall. Fiat, the country’s largest industrial company, closed one car plant last year. And CEO Sergio Marchionne is now threatening to shut others. Youth unemployment is at record highs of 36%.
Yet one part of the economy is doing well, very well: The manufacturing and sale of weapons of death. Arms Made in Italy generate 3 billion euros a year. And they sell all over the world.
To NATO and EU countries, for sure. But two third of sales are to countries elsewhere. Including some rather nasty regimes.
For example, 14,000 rounds for tanks, sold to Egypt in the middle of the riots that overthrew the regime of Hosni Mubarak Nasser. 127 million euros of assault rifles and grenade launchers to the dictatorship in Turkmenistan. 30 million of unspecified deliveries to the authoritarian regimes of Gabon, And Algeria, which as purchaser of over 477 million euros-worth of lethal hardware, was the leading customer of Italian arms. These are just some of Italy’s exports in 2011 to conflict zones, places infamous for their human rights record.
So Italy’s arms business is having an excellent crisis. Thanks in part to a expansion over the in sales to non-traditional trading partners who are now the main recipients of arms. Only 36% of export licenses, or 1.1 billion euros worth, were to NATO-EU countries last year. Over 64%, amounting to just under 2 billion euros, go elsewhere. An almost exact reversal of the picture three years ago.
With its civilian business in the doldrums, Finmeccanica, the country’s second largest industrial company, is looking at selling off its energy and rail transportation businesses. A plan Fiom, Fim and Uilm metalworkers unions are opposing, including through strike action last month. Such a strategy is dangerously short sighted, they argue. After all, one day demand will very likely pick up for life-sustaining products too.