SIMEST (Società italiana per le imprese all'estero) S.p.A.
SIMEST was set up in 1991 to promote foreign investments by Italian companies and to provide technical and financial support to investment projects.
Since 1999 it has administered various forms of public support for the expansion of Italian firms abroad, comprehending the support to export credits for investment goods produced in Italy.
Under officially supported export credit programs, SIMEST provides buyers and supplier credits.
Simest is also quite active in getting equity participations in project or start-up companies in order to promote Italian foreign direct investments.
Simest was established to primarily promote the “internationalisation” of Italian small and medum enterprises, facing a harsh competition by global actors. The major Italian ECA providing buyer and supplier credit of Italy, Mediocredito Centrale, was privatised during the '90s and acquired by a major Italian banking group. Therefore Simest has remained the only Italian ECA providing export credits. At the same time Simest is very active in promoting FDIs and delocalisation of production – despite its severe impacts on jobs – by taking direct equity shares in specific project company and start-up companies abroad.
Simest is active in a variety of industrial sectors. In particular in the last years has become more active in participating or backing projects in the infrastructure sector (such as dams in Latin America) and agro-business, including controversial bio-fuel production in developing countries.
Who is involved
Since November 2012, 76% of Simest is controlled by the Italian gian public-private investment bank Cassa Depositi e Presit – 70% owned by the Ministry of Economy and Finance. Twenty four percent of Simest belongs to major Italian banks, some Italian large corporations – such as the Italian oil major Eni – and to several Italian business associations.
SIMEST's support is provided under the Fund established with Article 3 of Law 295/73 for export credit operations. SIMEST’s Support Committee is responsible for administering the Fund.
The Committee is composed of five representatives of the Ministry of Economic Development, Ministry of Foreign Affairs and Ministry of the Economy and Finance (among which, one is appointed by the Ministry of Economic Development and acts as Chairman), a representative of the regional governments and a representative of the Italian Banking Association(ABI).
Dodgy deals associated with SIMEST
Given the more limited size of Simest's business, less attention has been paid by media and civil society organisations in screening its operations in comparison with other Italian ECA, SACE.
However SIMEST is suprisingly also a member of the associaton of European Development Finance Institutions “operating in developing and reforming economies, mandated by their government to...help reduce poverty and improve people's lives; contribute to achieving the Millennium Development Goals”. This is particularly striking given that, contrary to what other EDFIs claim at least on paper, Simest has no poverty reduction objective - and eradication in the long term – in its statute and Italian law establishing it.
From a preliminary screening of SIMEST's portfolio, some of its recent investments are worth mentioning for the impacts they have on land exploitation, given the recent statements by SIMEST's CEO and Director General Massimo D’Aiuto that in the near future the company will focus more and more on energy production, trying to take advantage of, among other things, opportunities offered by biomass production and biofuels in Latin America, mostly Brazil. Biofuel production remains highly controversial, given its dubious environmental and developmental impacts.
At the same time, in 2011 significant controversy arose around the Palo Viejo dam in Guatemala, built by ENEL Green Power with the equity participation of Enel.