The city of Milan is stepping up its efforts to become a part of London’s asset management industry after Brexit is complete. A recent plan has been derived for a delegation from the Italian government to meet with UK companies in the next couple of weeks. Milan, the financial hub of Italy, hopes that up to 1,500 asset management and investment banking jobs will move from London to Italy. The initial attempts by the Italian Finance Ministry to entice fund managers in 2016 were unsuccessful after prime minister Matteo Renzi’s failure to finalize and pass through constitutional reforms. These reforms were to deregulate the financial industry, making it more appealing to foreign fund managers.
Last year, the Italian government changed its personal tax regime in an attempt to lure high-earning Italians to come back to the homeland. Mr. Pagani, the chief of staff of Italy’s Finance Ministry, said this was designed with the interests of portfolio managers and fund company executives in mind. Some of the new incentives include a 50% reduction of income tax for five years for middle managers and a flat €100,000 annual tax on foreign earnings for wealthy individuals, lasting around 15 years. According to recent figures from the European Fund and Asset Management Association, Italy’s fund industry is the sixth largest in Europe. This accounts for approximately 5% of the European Financial market share and €1.2tn in assets. “There is a consensus that London will remain an important player in the European financial sector in the future” said Keith Knutsson of Integrale Advisors.
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1/22/2018 0 Comments GDP Growth Germany 2017Germany’s economy posted fastest growth in six years in 2017, as GDP grew 2.2%. The World Bank estimates that Europe economy grew 2.4% in 2017, comparable to the 2.3% projection of the US.
With a boost of low interest rates, low unemployment, a weak euro, positive economic growth trends and rising wages propelling the economy, economists believe for Germany’s positive growth to continue. Some additional numbers from the report revealed a 5.2% increase in imports and 4.7% increase in exports. The overall budget surplus has reached 1.2% of GDP, and Germany’s increased investment spending is reflected through figures such as the 3.5% increase on plant and machinery. For now, the political arrangement for a coalition in Germany has not stabilized. Analysts are evaluating the impact of these numbers on the final day of exploratory talks for formal negotiations with the SPD. Given that much of Merkel’s criticism is derived from accusations of economic apathy, with investors complaining about an over-restrictive tax system hindering much of Germany’s potential growth. The public sector as a whole posted a record surplus of 38.4 billion euros, indicating the ability for the government to trim the tax burden and increase spending. Meanwhile, the SPD continues to argue for increased taxing of high earners in Germany. Whether this data encourages Merkel to make additional concessions to an agreement with the SPD will remain to be seen. The SPD publicly remains skeptical to Merkel’s proposal for a coalition, but key leaders such as Martin Schulz are attempting to sway delegates of their own party towards agreement. Keith Knutsson of Integrale Advisors commented, “I have demonstrated my faith in Germany’s economic growth for years now – despite the current political limbo there is much potential left in the market. “ 1/18/2018 0 Comments German Economic GrowthIn 2017, Germany’s economy grew at the fastest annual pace in nearly a decade. As a result, this is a large contribution to the pickup in growth across the eurozone.
According to the German National Statistics Office, GDP (gross domestic product) grew 2.2% last year, after analysts expected growth of 2.3%. Nevertheless, it was the fastest pace of growth recorded since 2011. Germany’s strong performance feeds into the success of the eurozone. On Tuesday, the World Bank estimated the EU’s economy grew 2.4% in 2017, which would be its strongest performance since 2007. The expectation is that Germany’s positive growth and momentum will continue in the current year. Trade played a big role in the growth: imports grew 5.2%, exports were up 4.7%. “Looking to the future, the fundamental factors that supported growth in 2016 and 2017, such as rising industrial production and larger demand for real estate, should still be in place in 2018” said Keith Knutsson of Integrale Advisors. The recent pickup in growth across the eurozone has made policy makers at the European Central Bank more confident that they will reach their inflation target over the next couple of years. The central bank is decreasing monthly bond purchases under the quantitative easing program from €60 billion from €30 billion. The acceleration in growth has been fueled in part by a rise in business investment, with Germany seeing a 3.5% rise in spending on domestic plant and machinery in 2017. Eurozone industrial production was 1% higher than in October, and 3.2% higher than in November of 2016. As a result, Germany remains the Eurozone’s manufacturing powerhouse. |
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October 2018
CategoriesAll Investing Keith Knutsson Real Estate Real Estate Investing |