Ah, an update, finally! Yeah, real life can be truly annoying and keep you from the important things of life as alternate history

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As mentioned before the government is taking out a series of public and private loans. Also, the state of the Italian economy is still better with their being generally less sanctions placed against it in this time. This has allowed for the gradual buildup of more industries at this time.
Since the money is truly an issue, what about dropping the whole Ethiopia invasion? OTL, it costed an ungodly amount of money (nearly a whole year of GDP, IIRC). Mussolini could accept ITTL the Hoavre-Lavalle plan, for example, or make of Abyssinia a protectorate. The money thus saved could help the italian economy a lot.
Also, since Italy is considering joining the German side in any upcoming conflict Mussolini is open to the idea of cross training troops so they can better fight together.
I'm quite dubious on this. The german army has still to establish a reputation of clear superiority, not to mention the loss of face that would be accepting military advisors by Germany.
As for the cross-training, I'm not conviced either. Both armies kept their own secrets OTL. The italians, for example, never revealed to the germans anything about the sea secret operations (decima Mas and so forth).
I don't actually see why they should both more forwarding ITTL, considered that the italians are not going to join Germany in 1939...
As for the new chapter, nothing to really object a part from the lack of a proper ultimatum to Yugoslavia. I think that Mussolini would have at least paid lip service to the diplomatic niceties.
Interesting twist with the bulgarians and the Turks, which of course brings forward the question about the greek and rumenian reactions. Not to mention the german one...