2nd ET 2050 meetingBrussels, March 19-20 2012

 Transnational Region Reports

South Mediterranean Region(Italy, Slovenia, Libya, and Egypt)

Polimi RU 

Egypt

Italy

Libyan Arab Jamahiriya

Italy

Italy

Slovenia

Politecnico di Milano, Project ET2050, 2012

Regional level: NUTS0 Source: Politecnico di Milano, 2012 © EuroGeographics Association for administrative boundaries

This map does not necessarily reflect the opinion of the ESPON Monitoring Committee

Contents

1. Italy1. Strengths2. Weaknesses

2. Slovenia1. Strengths2. Weaknesses

3. Libya1. Strengths2. Weaknesses

4. Egypt1. Strengths2. Weaknesses

Italy: Strengths

1. Founding member of the EU (Rome Treaty signed in 1957)

2. Diversified and rich economy; strong manufacturing sector (mainly SMEs); rich and high-quality agricultural sector; some notable advanced services industries.

3. Some strong high-tech (e.g., machinery) and high-profit (e.g., fashion, Made in Italy, design) exports

4. Relevant policies recently decided and mostly already enacted against

1. Public debt/deficit

2. Public expenditure profligacy

3. Excessive labour regulation.

Reduced international pressure on sovereign debt

Italy: Weaknesses

1. Stagnating growth pattern since 1992: pc GDP falling from 82% of the US production, to a current value of 67%

2. Ageing population: Italy has the second largest old-age dependency ratio worldwide. Need to address this by continuous adjustments of the pension system

3. Massive immigration: total share of foreign-born dwellers will increase from 7.54% in 2011 to 22.97% in 2065

4. Relative political instability (ruling governments have lasted on average 0.9 years each since 1948)

5. Consistent interest payments on outstanding debt constraints on growth-enhancing measures. Latest official debt/GDP ratio: 119%.

6. Relevant internal divisions – Northern and Central regions earning more, and often growing faster, than Southern ones

Slovenia: Strengths

1. Steady economic growth in the last two decades

2. Moderate urbanisation processes, with more than three fifths of the Country covered with forests, and about 14 per cent of the land destined to permanent grassland

3. Sustainable public finances, moderate public expenditure, reasonable . Debt/GDP ratio (currently around 35 per cent).

4. Large (and increasing!) share of manufacturing in the Country’s production (currently around 30 per cent of total value added)

5. Previously hosting plants relocated from EU15 countries, currently the reverse process is taking place, with Slovenian companies off-shoring their production to look for cheaper labour

6. Potential challenge: : stabilising the current trade pattern, and expanding skills-intensive production

Slovenia: Weaknesses

1. Ageing population: need to revision of current pension schemes

2. Relevant rural/urban dichotomy

3. Non-negligible spatial imbalances: the richest NUTS3 region produces about twice as much as the poorest

4. Ongoing trends of deforestation and diminishing availability of agricultural land

5. Risk: Sustainability of the development process in terms of the environment and future urbanisation processes

Libya: Strengths

1. Massive wealth of natural resources (mostly oil and gas) leading to...

2. A very good positioning in terms of per capita GDP and HDI (highest HDI in Africa and fourth highest per capita GDP in PPP in Africa, behind Seychelles, Equatorial Guinea and Gabon)

3. Remarkable public financial stability (very low debt/GDP ratio ), mostly spurred by oil revenues

4. Availability of labour force, mostly driven by remarkable population growth rates (averaging 3.5 per cent per year between 1950 and 2010) and net inward migration

Libya: Weaknesses

1. Political instability (recent upsurge leading to the fall of Qhaddafi)

2. Relevant internal divisions:

1. Political - The Country appears politically divided in competing tribes

2. Spatial – 84 per cent of total population lives in coastal areas, with the inner territories being mostly barren

3. Regional – Tripolitania, Fezzan and Cyrenaica often competing for the access to natural resources (mostly located in the latter)

3. Heavy dependence of the economy on oil revenues: more than half its GDP was produced in the extraction sector

4. As a result, Libya’s economy heavily depends on external demand

5. Industrial composition highly concentrated: 2/3 of total GDP produced in natural resources. However, 17% of labour force is still employed in agriculture (with very low productivity levels)

Egypt: Strengths

1. Favourable position w.r.t. international trade patterns: Suez canal, possible key of trade between EU and Middle East countries

2. Availability of labour force: from WWII to today, its total population almost quadrupled to about 80,000,000 inhabitants, to a large extent in the young and working age class

3. Improving life conditions in many respects (e.g., life expectancy, infant mortality rates, emigration rates)

4. Convergence with respect to EU and US standards is slow but steady

Egypt: Weaknesses

1. Limited availability of arable land: up to 97 per cent of total Country surface is barren. exposure to increasing world temperatures and further desertification

2. Political instability: recent political upsurge leading to the overthrowing of Hosni Mubarak. Risk of future political backwardness (major influence of Muslim pseudo-fundamentalist groups like the Muslim Brotherhood)

3. Labour force still relevantly illiterate (with a non-negligible adverse gap female-male: 37% vs. 22% according to the 2006 pop. census))

4. Major spatial imbalances, mostly driven by usable land availability: 98 per cent of total Egypt population lives in just 3 per cent of the total Country territory high population density (2,755.2 inhabitants per square kilometers if calculated per unit of arable land!)