Despite an increase in trade between Ukraine and Italy in 2017, many big Italian companies are still not ready to invest in Ukraine — mostly because of the corruption risks and weak rule of law, Davide La Cecilia, Italy’s ambassador to Ukraine says.
However, La Cecilia believes Italy will continue to support Ukraine, politically and financially, and the current political crisis in Italy will not lead to Italy dropping sanctions against Russia which has been waging a war against Ukraine for over four years.
The strengthening of the two countries’ relationship manifests itself in the growing trade. Ukraine’s export to Italy grew by 28 percent, to almost $2.5 billion in 2017, while Ukraine’s imports from Italy grew by 19.6 percent, to $1.6 billion, compared with 2016.
“It means that we are more and more aware of the potential offered by the Ukrainian economy,” the ambassador says. “We are ready to come here to work with Ukrainian companies — in energy, especially alternative energy, in infrastructure and agribusiness.”
However, La Cecilia says there won’t be a major investment in Ukraine unless the country’s authorities build a safe environment for foreign business to step in.
“Problems that we have had in the previous few years haven’t gone away,” he says. “We believe that an effort should be conducted especially in order to establish the anti-corruption court. This is very important — it will mark the point of no return.”
Trade
Ukraine’s top export products to Italy are metal and agriculture products, while Italy brings to Ukraine fashion-related goods, food products and machinery.
Italian products find lots of appreciation on the Ukrainian market, La Cecilia says, however, they are often perceived as a luxury.
La Cecilia wants to see affordable Italian food, furniture and clothes available for a larger number of Ukrainians.
“We would like to spread these products among people not only in Kyiv, but to the rest of the country,” La Cecilia says. “This is a big challenge for us.”
Traveling
Meanwhile, traveling to Italy has already become more affordable for Ukrainians. The visa-free travel regime with the European Union countries came into force one year ago in June 2017, making travel much easier for Ukrainians. Another factor is the Italian airlines that provide direct flights between the countries.
Apart from Alitalia, which resumed direct flights to Ukraine in 2017 after a three-year break, Italian low-cost Ernest Airlines entered Ukraine last fall with the flights to Naples, Milan, Bologna, Venice, and Rome.
Due to these changes, 42 percent more Ukrainians — 173,573 — visited Italy in 2017, compared to 122,294 in 2016.
The number of Italian tourists to Ukraine increased as well — from 77,787 in 2016 to 84,638 in 2017.
Support
According to La Cecilia, Italy that “has strongly supported the visa-free regime and was one of the first countries to ratify the Association Agreement between Ukraine and the EU” will continue supporting Ukraine in line with its obligations to the international financial institutions, as well as to its chairmanship of the Organization for Security and Co-operation in Europe (OSCE).
Also, in 2017 Italy provided a total of 1 million euros of humanitarian help to Ukraine through the International Committee of the Red Cross, World Food Programme, and the United Nations Children’s Emergency Fund. For 2018, the aid is planned at 2 million euros.
“I don’t see elements that would tell me that something would change,” La Cecilia says, talking not only about financial support, but also about the sanctions against Russia, whose war on Ukraine in Donbas has claimed at least 10,400 lives.
The agreement between Italy’s two populist parties, the left-wing Five Star Movement and the far-right Lega, which tried forming a ruling coalition after their success in the parliamentary elections in March, suggested, among other things, lifting the EU sanctions on Russia.
However, Italian President Sergio Mattarella vetoed their choice of an economy minister, leading the political situation in the country into hubbub.
La Cecilia says that he doesn’t want to “speculate” on the topic, since the “political forces are still into the discussions.”
However, he is sure Ukraine has nothing to worry about.
“Sanctions for us — and it’s not a mystery — have a cost, and we would like to see this crisis solved,” he says. “There’s no risk that Italy will drop sanctions against Russia. Despite the cost, we will stick with our system of alliances.”
