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Speech by the Hon. Minister at the event hosted by Confindustria: “How much is Italy’s economic diplomacy worth? The economic impact of the Farnesina’s support to Italian companies” – Tuesday, 31 January 2017

(The authentic text is only the one actually delivered)


Ladies and Gentlemen,

Allow me to express a heart-felt thanks to President Boccia and to all our friends of Confindustria for the warm welcome.

As you know, I have just returned to Rome from a very important mission to the Emirates.

Economic diplomacy is what inspired all my talks and the first session of the Strategic Dialogue between Italy and the Emirates.

Economic diplomacy is a strategic priority in my mandate at the Foreign Ministry. I underscored this to Parliament in the hearing in which I illustrated my foreign policy agenda.

Enterprises’ demand for services is growing. And foreign policy must be among the instruments used to support them in order to foster economic growth.  

The Foreign Ministry does much more for enterprises than what is commonly represented in the collective imagination.  

This is confirmed by the independent survey conducted by Prometeia that we are presenting today. 

Today’s meeting is extremely important for me. Because Prometeia’s survey “converts into numbers the virtues of Italy’s economic diplomacy” as well as the great value added created through the close cooperation between Italy’s Foreign Ministry and its Industrial System.   

The positive effect of the totality of our actions is now documented in an extremely rigorous and detailed analysis. 

A positive fallout that I would define as: “The Farnesina effect for growth”. 

The Farnesina effect has produced more than 1% of GDP and 234,000 jobs or a 1% increase in the rate of employment.

In financial terms, it amounts to 16.4 billion euros and 6.7 billion euros in tax revenue from corporate projects that received concrete support from the network of Embassies and Consulates.

We must certainly not stop at 1%. We can and must do more. But let us not forget that during these difficult years this value marked the difference between growth and stagnation. 

I will be very frank and tell you that it is for me a reason of great pride to contribute to the success of so many Italian companies around the world.

All the more so if we make a cost-benefit analysis that taxpayers are sure to appreciate. 

If you consider that the Foreign Ministry effective 2015 budget (excluding the resources allocated to development cooperation and the contributions to international organisations) referred to in the survey amounted to 0.11% of the State Budget, or 0.05% of GDP.

Which means that a Budget expenditure of 0.05% had a return of 1% in terms of GDP.

The Farnesina has a “multiplier” effect equal to 20.

It means that: “1 euro of taxpayers’ money given to the Farnesina has generated 20 euros in terms of Italy’s growth, obviously in teamwork with Italian companies”.

Allow me to highlight some of the aspects of Prometeia’s Survey that particularly struck me.

The first point is that of the total value – 52 billion euros – of the projects adjudicated to Italian companies, almost half of which – 26 billion euros – returns directly to Italy. 

The second point is the one that belies the myth that economic diplomacy only assists large companies: 61% of the companies that received support were Small and Medium-sized Enterprises.

It is true that, in terms of the value of contracts, big companies are adjudicated a larger share. But this is almost physiological.  

The study highlights that the adjudication of contracts and orders produces a series of indirect and induced effects all along the supply and sub-supplier chain that mostly involve SMEs.

The data we are presenting today are great but I’m the first to say that “we can and must do more”. 

So, seeing that not all entrepreneurs are fully aware of what economic diplomacy can do for them, I have decided to pay them a visit to tell them to rely more on our network of embassies.  

I have therefore put on my agenda missions to Italy’s major export centres in which to make available the “assets” of the Farnesina.  

Missions to Lombardy, Apulia, Piedmont, Veneto, Tuscany, Sicily, Emilia Romagna, Friuli, Marche and Campania are already on my agenda.

And then I intend to very soon organise an important event in Milan to support the Lombard capital’s plan to the attract banks, insurance companies, investment funds, enterprises, and European Agencies and Organisations that will inevitably leave London. 

Milan is a cosmopolitan city, open to global investments, a city that caters to corporate needs, a financial centre that offers a business environment that is far above the European average. Thus Milan is fully qualified to win the challenges posed by the Brexit also because it can count on the staunch and resolute support of the Foreign Ministry. There are all the preconditions to launch a Plan that I intend to call “Come to Milan”!

But in order to win this and the other global challenges, it is necessary to keep the pace with international events and the global economy.

This is why I too wanted to be among the first to push on the accelerator in organising this type of economic events.

Foreign policy was slow-paced in a long forgotten past. Today it has changed speed. Our decisions and responses must adapt to the pace of the time and be much quicker.  

This is particularly true in economic diplomacy and business matters where “time is money”.

A key concept that I always try to promote is that national interests must be fostered by taking immediate positions.  

Today decisions turn out to be winning or losing only if we are capable of predicting trends and grasping their importance in time. 

If we are capable of understanding the expectations of our Industrial System and subsequently direct the decisions of our global counterparties.  

It is with this spirit that I intend to conduct our economic diplomacy. Economic diplomacy must defend and promote Brand Italy, by helping Italian companies to overcome those obstacles abroad – sometimes legal but sometimes also political – that hamper our companies’ growth process. 

Italy’s economic system revolves around export. The risk of protectionist drifts relaunches the importance of economic diplomacy. Italy’s diplomacy must work to assure that our companies receive equal treatment. We cannot accept that foreign companies find the road paved in Italy while Italian entrepreneurs find it difficult to penetrate the same foreign market, having to face a rubber wall of red tape or political bans.  

I call on Italian ambassadors to enforce all possible rules to protect the right of Italian companies to conditions of reciprocity. We are in favour of international trade and don’t want to discriminate anyone but neither will we ever accept that any form of discrimination damage us.   

There is another qualifying aspect of economic diplomacy on which I would like to dwell: energy diplomacy. For an economic system such as Italy’s, which is highly dependent on imported energy, it is crucial to maintain stable and secure relations with our major energy suppliers. And especially with those suppliers such as Russia for example that have revealed to be reliable over the years, including in the most critical moments.  

Let us not forget that at the time of the Soviet Union, Italy far-sightedly decided to build gas pipelines that still now connect our companies and homes to Russian gas fields. That strategic decision was made at the peak of the ideological clash between the two blocks and I tell you that I intend to maintain and relaunch this productive interdependence. 

Italy’s diplomacy must take into consideration the primary need to foster our Country’s energy security by promoting stable and mature relationships with our major suppliers. Also in the energy sector, free, open and competitive markets are essential for our companies and for our energy security. But we must not lose sight of the geopolitical aspect of our relations with supplier Countries, an aspect that our diplomacy is fully aware of. I think that it is in our national interest to develop an intense dialogue between Confindustria and the Farnesina on this crucial issue. 

I’ve already said this in different words but I would like to repeat it for the sake of clarity: a positive interaction between diplomacy and enterprises in a global world is a primary goal of this Government in order to foster growth, competitiveness and employment. 

Confindustria has intensified its cooperation with the Ministry’s Situation Room for Internationalisation, which has promoted the Plan for the Extraordinary Promotion of Brand Italy and to Attract Investments.  

It is priceless teamwork that involves a very large number of players because, in a global world, only those supported by a cohesive and efficient Country System can manage to win.  

Not more or less efficient single companies but a system of entities that collaborate in designing and implementing unitary strategies to promote national development.   

I am convinced that our “Common Plan” marked a radical change of pace in economic diplomacy.  

Many resources have already been allocated and in 2017 we plan to mobilise another 200 million euros to finance promotional activities abroad.

Let us not forget that we are a superpower of culture, science and beauty. We must leverage this primacy also to relaunch our economy. 

Yesterday, in the Emirates, I announced that we will soon open an Italian Cultural Institute in Abu Dhabi. I recalled that we must put culture at the service of Italian enterprises. Enterprises represent the points of excellence of our creative industry and form an integral part of Italy’s image abroad. That is why we should increasingly try to work together.

On my part, I would like to assure enterprises – also at the presence of our Director General for Economic and Cultural Promotion and Innovation, Vincenzo De Luca – that the Farnesina is not only open but its doors are “wide open to companies”.

So now it’s up to you to step inside! 

Thank you very much. 

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