The Italian Economy

From the economic point of view, since the end of the Second World War Italy has been one of the European continent’s most dynamic countries, transforming itself from an essentially agricultural nation to a major industrial economy 
As emerges in the data of the national statistical institute Italy’s economic structure  is similar to that of the most advanced European nations.
Two-thirds of Italy’s Gross Domestic Product (approximately 69%) is represented b the services sector, whose strong point is tourism. Approximately 29% of the national income is owing to industry (including the construction sector) and the remaining approximate 2% derives from agriculture. The strongest industrial sectors are machinery and apparel/textiles.
The geographical distribution of the production of the nation’s wealth is as follows: approximately 31.8% of GDP is produced in the Northwest regions of the country, 22.3% in the Northeast regions, 21% in the regions of Central Italy; finally, approximately 24.8% can be attributed to the regions of Southern Italy.

One of the Italian system’s peculiarities lies in an “industrial cluster” model, well-established in a clearly defined area and consisting of a dense fabric of small and medium sized enterprises, each specialised in a specific phase of production. Thanks to this model Italy is a nation in which entrepreneurial initiative is highly developed and where entrepreneurial autonomy has led to the development of creativity and concentration on the beauty and good taste of those finished products that have raised the “Made in Italy” to world fame.
The Italian economy is not only small enterprise however. There are many large-scale industrial groups that contributed to the industrial history of the country and to its development.

“Made in Italy” does not only mean elegant apparel, sophisticated design and advanced machinery, but it also, and above all, translates into exports that contribute substantially to a national economy sustained and represented by the labour and initiatives of large-scale enterprises together with the vast network of small and medium-sized ones.

Agri-alimentary, machinery, apparel/textiles, industrial design and furniture and furnishings production are the sectors that not only are the most important in terms of the income, employment and number of firms, but which also underpin Italian exports throughout the world and thereby make a significant contribution to our country’s trade balance ).
Despite the  aggressive presence of China and other countries on the world  market, Italy ranks eigth in the world among major exporting counries and sixth amnf the world’s major importers.

The Italian economy is also supported by another important pillar: tourism, thanks to its inestimable archaeological and artistic patrimony.
Indeed, according to Unesco, more than half the world’s artistic/historic patrimony can be found in Italy, a country that counts hundreds of archaeological sites and over 2000 museums.  

Tourism is one of the Italian economy’s most important items: every year foreign travellers spend over 30 billion euro in our country, while Italians travelling abroad spend around 18 billion euro.
Thus it is calculated that the sector of tourism, including the activity it generates, contributes approximately one-third to the overall GDP by creating over one million jobs.

Investing in Italy

Attracting foreign investments is a crucial factor in the economic and social development of a country, in addition to being one of the priorities of the economic and industrial agenda. But the attraction of foreign capital is the fruit of a complex combination of factors concerned with policy, legislation and social, cultural and instrumental resources.
Foreign enterprises can find in our country a system of conditions entirely favourable for investment: a major market, synergy with industrial clusters (apple of the eye of the Italian industrial community), competitive logistical facilities, targeted training, primary incentives, participation in capital and, above all, industrial ideas and design sense.
Moreover, the close correlation between transport demand and GDP growth has led to the definition of a strategic intervention plan aimed at the creation of new and more advanced infrastructures to which all the regions have agreed

Enterprises operating in Italy can take advantage of a great many opportunities and incentives : from the financing of the purchase of machinery and plants all the way to the legislation regulating the launch of new business activities, and in this context there are also specific provisions for women’s enterprises.
The law governing incentives is currently based on community provisions on State Aid to enterprises. Available incentives are stipulated in regional laws, national laws or Community programmes 
Businesses are differentiated between large-scale, small and medium-sized (SMEs) and micro-enterprises. As of January 1st 2005 the definition of small and medium-sized enterprises—which are the main recipients of incentives—follow the criteria contained in new recommendation 361/2003/EC adopted by the European Commission, which also introduced the new category of micro-enterprises.
Interventions and incentives for the benefit of businesses can be grouped into two main categories: financial incentives and tax relief.
Financial incentives consist mainly of: contributions to capital accounts, which are determined as a percentage of the allowable expenses; grants that do not foresee repayment of capital or of interest; contribution to interest accounts aimed at lowering the interest rate applied for financing the business, Tax relief is considered an indirect type of incentive as it does not consist of direct contributions but works by means of exemptions or reductions of the fiscal burden.