Italy Says $1.1 Billion Navy Ships Sale to Egypt Not a Done Deal

(Bloomberg) --

Foreign Minister Luigi Di Maio has denied that a sale of two naval frigates to Egypt has been finalized, as a commission in parliament called for consultations with the prime minister over the unexplained death of an Italian student in Cairo.

Di Maio said the government is continuing with a political evaluation of the sale, which involves two vessels originally designed for the Italian navy. Italian newspapers reported earlier in the week that the state had already approved the sale, at more than 1 billion euros ($1.1 billion), in a deal hammered out between Prime Minister Giuseppe Conte and Egyptian President Abdel Fattah El-Sisi.

At stake: even more lucrative arms sales to Cairo, possibly totaling between 9 billion and 11 billion euros, newspapers including Corriere della Sera reported Thursday. Deals of that magnitude would come as a shot in the arm for beleaguered companies including shipbuilder Fincantieri SpA and aerospace and defense company Leonardo SpA.

In addition to general concerns about human rights in Egypt, the unexplained torture and murder of Giulio Regeni in Cairo in 2016 has weighed on diplomatic and commercial relations between the two countries. Di Maio said in parliament that Rome is still waiting for final results of an investigation into the student’s death.

“Our incessant request for significant progress in the investigation into the case remains firm,” Di Maio said, in comments cited by Ansa news wire.

Regeni, 28, disappeared in the Egyptian capital while doing research for a doctorate at Cambridge University. Prosecutors in Rome have focused on five members of the Egyptian security forces for possible involvement in the murder, Ansa said, straining ties between the two countries.

©2020 Bloomberg L.P.

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