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Eni for 2016 | Cooperation model

Local

content

Local content is the added As a result, in 2016, Eni to economic, employment and
value that the Company can launched the inter-departmental intellectual capital impacts that
bring to the socio-economic project “Model for local content Eni’s business generates directly
system of its host Countries. assessment” with the aim at local level and indirectly
It is the way in which the of developing a simple model along the supply chain.
Company, in conducting its that can easily be replicated The model was applied for the
business, can be a driver of to assess direct, indirect first time to a pilot project in
development in the contexts and induced effects of Eni’s Ghana, helping to define a local
in which it operates. activities in operational content plan that is in line
Eni believes that enhancing contexts. with the IFC and World Bank
local content and its monitoring These effects are attributable requirements.
is a tool which is useful for
better planning activities inside The Politecnico di Milano has given
the Company and, outside,
it helps Countries to direct its scientific support, validating the
investments in economic
development. Model for local content assessment

Direct Effect Indirect Effect Induced Effect
IMPACT CATEGORY

˛ Economic impacts • Eni purchases • Backward expenditure • Effect of houshold
expenditure for local for local goods/services consumption, as direct
goods/services along the supply chain and indirect employees
• Eni wages paid to local • Wages of supply chain spend their wages within
employees local employees the local economy
• Eni taxes paid • Taxes paid by suppliers

˛ Employment impacts • Local jobs directly • Local jobs along the • Local jobs created in the
involved in the Project supply chain directly private sectors, due to
involved in the project household consumption
• Local jobs created in
the public sector, due to
Government revenues

˛ Human Capital Development • Eni training expenditure • Differential present value • Household consumption
for local employees of lifetime earnings generated by differential
expectancy between lifetime earnings
trained and not trained expectancy
employees • Government revenues
(additional taxes)