WTI Magazine #65    2015 July, 24
Author : Fondazione Symbola, Unioncamere, Fondazione Edison      Translation by:

There is an Italy which we often do not know that does things every Italian should be proud of. The Rapporto I.T.A.L.I.A. - Geographies of the new made in Italy edited by Fondazione Symbola, Unioncamere and Fondazione Edison was created to tell this part of our country. A report that is sponsored by the Ministries of Foreign Affairs, of Agriculture, of Culture, of Environment and by Expo Milano 2015 and that takes us to a journey through the many talented Italians.

Browsing through the pages of the report we find that Italy knows how to be innovative, versatile, creative, responsive, competitive and successful. Especially in global markets. We have much to give: despite seven years of crisis, we have almost a thousand products with a great trade surplus. A result of all respect, achieved thanks to a strong choice on quality. And in line with our leadership in terms of the trade surplus: Italy is one of only five countries in the world that has a manufacturing surplus of over 100 billion dollars. Together with great industrial powers such as China, Germany, Japan and Korea. A leadership that speaks of an increasing quality recognized to our manufacturing. Not surprisingly, since the euro Italy has seen the average unit values of its products go up by 39%, doing better than the United Kingdom (36%) and Germany (23%).

These data are supported also by the tendencies observed in a recent Ipsos survey that about 80% of the Americans and the Chinese recognize the Italian a great value. Both abroad and at home Made in Italy is synonymous with fashion, crafts, furniture, design and food, and above all beauty and quality. Two out of three Italians are willing to pay a premium for 100% Italian products. Thanks to the beauty and quality inherent in our products, then, Italy continues to produce things that please the world and which are increasingly desired in global markets. Google searches of products made in Italy from 2011 to 2014 grew by as much as 22%. Besides, opening up to global markets by exploiting the possibilities offered by new technologies is a concrete answer, and already practiced by many of our businesses, to the contraction of the internal market.

This is the country that emerges from I.T.A.L.I.A. - Geographies of the new made in Italy, a report that, without hiding the difficulties of our internal market, measures the competitiveness of the Italian economy with no "traditional" parameters as the market share held on World exports, but with a new indicator that can capture and read our economy much more faithfully and accurately: the trade balance of the individual products. It means that if we think about the global market as the Olympics, about products like sports where the winner is the country with the far greater export then his import, Italy wins a medal nearly a thousand times. Only China, Germany and the United States are ahead of us.

Italian competitive excellences in foreign trade
Italy has a total of 932 products who finished first, second or third in the world for trade surplus with other countries.

More specifically, our country has boasts 235 products gold medalist for global trade balance, excellences that make us earn $ 56 billion. We have 376 products ranked second in the world for trade balance which make us earn $ 68 billion. The bronze medals of the Italian exports are 321 products and are worth an overall trade balance of $ 53 billion. Together, these champions make to our country a trade surplus of $ 177 billion. And then there are other 500 Italian products ranked fourth or fifth in the world trade balance, adding to our trade balance additional $ 40 billion.

Industry, competitive sectors and the strength of the districts
Besides numbers, significant are also the sectors that generate this surplus. Most of our manufacturing excellence comes not only from traditional sectors, which may be the textile or footwear, but comes from the mechanical and transport connections, the technologies of heat and cold, from the machines to work wood and ornamental stones, pipes and hollow profiles, instruments for air and space navigation. All of this is added to the garrison of those areas in which the made in Italy is traditionally strong, such as design or luxury. An analysis of our 235 gold medal products tells that 25,6 of the $ 56 billion surplus generated by our excellence derive from the field of mechanical engineering, rubber and plastic; other $ 18,4 billion are due to clothing and fashion goods; $ 7,3 billion in food and wine; $ 0,4 billion from personal goods and household; while $ 4 billion derive from other products, including those of the paper industry, glass and chemistry.

Among the products second for the trade balance taps and valves have particular relevance, generating $ 4,9 billion. Then there's the field of wines, sparkling or not, with $ 4,5 billion; the wooden furniture and parts thereof, works in iron and steel, agricultural tractors, tiles and ceramics to furniture, parts of gas turbines, machines for filling and bottle and label, works in aluminum, machinery parts and mechanical equipment, pleasure boats and yachts.

As for our bronze medal products we can mention items of jewelry, parts and accessories for tractors and vehicles, tile and slab flooring or coating, machinery and mechanical appliances, plastic products, gear and gearing for machinery, pumps and air compressors, sofas, armchairs, brakes and servo-brakes, bridges with differential for motor vehicles, construction of iron and steel.

Tourism
A particular mention is deserved by tourism: we will never have an accurate portrayal of the sector's performance until, as an indicator, we will use the number of arrivals. On the contrary, looking at the overnights highlights the Italian record in the Eurozone for stays of tourists coming from outside the EU. In 2013, in fact, Italy was ranked first in the eurozone for the total number of nights spent by tourists from outside the EU: 56 million. In the Old Continent we are the favorite destination for Americans, Japanese, Chinese, Australians, Canadians, Brazilians, South Koreans, Turkish, Ukrainians and South Africans. And the direct contribution of tourism to our GDP in 2014 was 4.1%, for a value of € 66 billion.

Agribusiness, an area suited to quality
In our agri-food sector the commitment to quality is evident. No coincidence that Italy has the ability to create the value added of nearly € 2,000 per hectare, more than twice the European average, three times the United Kingdom (€ 614 / ha), twice of Spain (€ 906 / ha) , and Germany (€ 994 / ha), and 60% more than the French cousins (€ 1,226 / ha). Not only that, with 273 registered products between PDO, PGI and TSG, 523 wines with denomination of controlled and guaranteed origin and geographical indications, and 4698 traditional regional specialties, we are ahead of everyone for registered products and we are the first EU country for number of organic businesses (44,000). Italian agriculture is the most sustainable in Europe - emits 35% less greenhouse gas than the EU average - and one of the safest, with a market share of products with chemical residues almost 10 times lower than the European average. It is for these reasons that our agriculture, in 2014, confirms its leadership in Europe, along with France, regarding the value added (€ 31,6 billion).

Localism and subsidiarity: the Third Sector
In the production and delivery of services our country would never reach the current level of welfare if it could not count on the contribution of the diverse galaxy of the third sector. Another Italian record: among the big EU countries, with 9,7%, Italy is the first for percentage of workers in the Third Sector. And these realities create revenues for € 64 billion, equivalent to 3,4% of the national economy. A wealth that should be accompanied also with the savings and the social welfare arising from the hours of free of charge work donated by 4,7 million volunteers. These numbers describe a model that captures the economy of responsibility, sobriety and sharing that is making its way all over the Western world.

Innovation and environment
Italy is fourth in Europe and is one of the eight OECD countries to have a research and development spending above $ 20 billion. The Eurostat showed that Italian companies have a strong propensity for innovation: with 42% of innovative enterprises, Italy is above the EU average (36%), not to the levels of Germany and the Baltic countries, but better than France, the UK and Spain. Our production system also incorporated the green economy as a competitive factor: since the crisis began, more than 340 thousand companies (22% of the total) have invested this way, and we get to 33% in manufacturing. So we arrive at the top of the EU for eco-efficiency, with 104 tons of CO2 per million euro product (Germany enters into the atmosphere 143 tons, the UK 130) and 41 tons of waste (65 in Germany and the United Kingdom, 93 in France). We are, then, European champions in the recycling industry: with an industrial recovery of 163 million tons of waste in the whole Europe, in our country we recovered 24,1 million, the absolute highest of all European countries (in Germany it was 22,4 million).

Art and culture, a strategic sector
Over 443,000 companies, meaning the 7,3% of the total of domestic economic activity, are part of the cultural and creative production system (including proper cultural industries, creative industries, historical and artistic heritage, performing arts and visual arts). They employ more than 1,4 million people, 5.9% of total employment; and they create € 78,6 billion of value added, which become 84, equivalent to 5,8% of the national economy, if we include public institutions and non-profit organizations active in the field of culture. Besides, with their business, these enterprises activate in the rest of the economy other € 143 billion, for a total of € 227 billion: the 15,6% of the total of the Italian economy.