Gulf ties could aid Islamic finance in Italy, supporters hope

Italy is seeking trade and investment with wealthy Gulf Arab states as a way to grow out of its debt problems. Gulf investors have already shown considerable interest in Italy's luxury good firms; in 2012, for example, Italian fashion brand Valentino was bought by Qatar's royal family. Moreover, Kuwait's sovereign wealth fund announced this month that it would invest 500 million euros ($685 million) in Italian companies in coordination with the Italian government's own strategic investment fund. Italy made a similar deal with Qatar last year. These activities should include a review of existing regulations. Currently, however, only broad discussions are taking place with Italian policy makers and no specific agenda is in place. Italian companies have explored Islamic financing options in the past but did not do deals, partly because of a lack of regulatory support in Italy.