MGI Weekly round-up | 13 October 2017

Stories MGI has been tracking this week:

  • Household cooking-oil recycling vital for Italy’s bio fuel producer
  • Turkey-US diplomatic tensions pose threat to trade
  • Israel’s tax revenue hits record-high in September

And as always, we feature content from the MGI data and analysis platform, a summary of the week’s key statistical releases, and a look to the week ahead in data. In this newsletter, we use the MGI platform (WB dataset) to examine the historical evolution of oil rents in Italy.

Household cooking-oil recycling vital for Italy’s bio fuel producer

Biofuels represent a small part – about 1% – of Italy’s total energy production. Nevertheless, this market is expanding. The government – driven by the EU’s renewable fuel target and Italy’s rich diet in olive oil – is providing financial incentives to producers. Eni SpA – Italy’s oil and gas giant – produces bio fuel. The company has a bio-refinery in Venice that can process 360,000 tons of vegetable oil and other fats and feedstocks per year. In addition, a plant upgrade in 2020 will allow it to process 600,000 tons, delivering 420,000 tons of biodiesel (i.e. about 73% of Italy’s bio fuel production in 2015). The company also plans to build a new bio-refinery in Gela, Sicilia.
 
According to Conoe – the umbrella body for Italy’s oil collection and treatment companies – about 70,000 tons of used oil are gathered each year in Italy and most of it comes from restaurants. The amount can increase significantly – to over 200,000 – if more households would also start recycling. Although Italy ranks second in oils and fats consumption among euro-zone countries, incentives for households to recycle remain limited. In order to encourage household participation, Conoe will launch an awareness campaign next year.


Turkey-USA diplomatic tensions pose threat to trade

The diplomatic dispute between the US and Turkey may pose significant risk to bilateral trade between the two countries. Tensions started on 4th October when a Turkish citizen which worked for the US consulate in Istanbul was arrested for possible involvement in the last year’s putsch. Following this event, both countries suspended visa services for each other’s citizens. “This will have a very deep impact on many things, especially in trade, if it is prolonged”, Ekim Alptekin, head of the Turkey-US Business Council said in a telephone interview for Bloomberg.
 
The USA is Turkey’s fifth-largest trade partner. The volume of bilateral commerce stood at $17.3 billion in 2016. More than 1,700 US companies have significant investments in Turkey but Turkey has also big companies in the US e.g. Borusan Mannesmann Boru Sanayi, cement producer Cimsa Cimenta Sanayi and industrial fiber maker Kordsa Global.
 
Interestingly, in the midst of these tensions, the value of the shares of affiliates of US companies – such Ford Otomotiv Sanayi AS or Coca-Cola Icecek AS – listed on Borsa Istanbul fell substantially.


Israel’s tax revenues hit record-high in September

Israel collected record high tax revenue – NIS 29.5 billion – last month. The high tax revenues during this month were partially due to the taxation of wallet companies – which usually employ one worker, the company’s owner. Specifically, under an administration order that expired at the end of September, controlling shareholders were able to withdraw dividends from their companies at a lower tax rate (25% compared to the regular 33%). The tax revenue surplus was further increased by the collection of capital gain tax from Mobileye shareholders who sold stakes to Intel.
 
According to the Ministry of Finance, the tax collection surplus lowered the budget deficit for the past 12 months to 1.9% of GDP.


Featured content from the MGI.online data and analysis portal

Oil rents are the difference between the value of crude oil production at world prices and total costs of production. This is one of the indicators from World Bank’s World Development Indicators database and it is available on the MGI website (https://www.mgi.online/wb-series/). This week, we use this database to analyze oil rents (as % of GDP) in Italy. The annual evolution of this indicator – for the period 1990-2015 – is displayed in the graph below.

As we can see, oil rents represent a small part of the country’s GDP. In 1990 oil rents represented 0.04% of GDP. The indicator reached a peak – of 0.12% – in 2012 and since then has displayed a negative trend. In 2015, oil rents represented 0.05% of Italy’s GDP. 

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The week in data

Highlights from national statistics releases tracked by MGI this week include:

 

  • Albania's CPI in September 2017 increased 1.6% vs September 2016 
  • Turkey's IPI (seasonally and calendar adjusted) in August 2017 decreased by 0.1% vs July 2017 
  • Greece's CPI increased 1% in September 2017 vs September 2016 
  • France's IPI in August decreased by 0.3% over the previous month (seasonally-adjusted data) 
  • Spain's CPI in September 2017 increases 1.8% YoY and 0.2% vs August 2017 


Looking ahead

In the coming week, we expect inflation rate data for Croatia and Morocco, Greece’s real GDP numbers for 2016 and the Central Bank of Israel’s interest rate decision. MGI’s complete data release schedule can be viewed at https://www.mgi.online/release-calendar/.
 
Monday 16 October, 2017:

  • Turkey unemployment rate and employment for July
  • Croatia inflation rate for September
  • France 3-month, 6-month and 12-month BTF auction 

Tuesday 17 October, 2017:

  • Italy balance of trade for August
  • Spain 3-month Letras auction
  • Israel real GDP for 2017Q2 (third estimate) and tourist arrivals for September
  • Greece real GDP for 2016, provisional data
  • Slovenia employment (register data) and IPI for August

Wednesday 18 October, 2017:

  • Israel inflation expectations for October

Thursday 19 October, 2017:

  • France 3-year and 5-year BTAN auction
  • Israel consumer confidence for September
  • Israel central bank interest rate decision

Friday 20 October, 2017:

  • Slovenia PPI for September
  • Slovenia employment (detailed register data) for August
  • Italy current account for August
  • Morocco inflation rate for September
  • Turkey central government debt for September
Round-upalma economics