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Economy Of Italy

The economy of Italy was in 2008 the seventh-largest economy in the world and the fourth-largest in Europe, according to the International Monetary Fund. Italy belongs to the Group of Eight (G8) industrialized nations; it is a member of the European Union and OECD. The country is divided into a developed industrial north dominated by large private companies and an agricultural, state-assisted south. Italy has, according to The Economist the world's 8th highest quality of life index, has a very high standard of living, and is the world's 18th most developed country, surpassing countries such as UK, Germany, and Greece. The country also is home to 6 of the world's 100 biggest companies.http://www.forbes.com/lists/2009/18/global-09_The-Global-2000_Rank.html According to the World Bank, Italy has high levels of freedom for investments, business and trade. Italy has the world's 6th (7th including the European Union) highest exports, that of US$ 546,900,000,000 (est.) in 2008. Italy, also, is the world's fifth largest industrial goods producer with a US$381 billion output in 2008. Also, the country exports and produces the highest level of wine, exporting over 1,793 tonnes. Italy was responsible for producing approximately one-fifth of world wine production in 2005. On addition to that, Italy has the world's 4th (3rd excluding the IMF) largest gold reserves, that of 2,451.8 tonnes, coming after the USA and Germany, and surpassing France and China.

Tourism is one of the fastest growing and most profitable sectors of the national economy: with 43.7 million international tourist arrivals and total revenues estimated at $42.7 billion, Italy is the fifth major tourist destination and the fourth highest tourist earner in the world.

According to Eurostat data, Italian PPS GDP per capita approximately equaled the EU average in 2008.

History




The unification of Italy broke down the feudal land system that had survived in the south since the Middle Ages, especially where land had been the inalienable property of aristocrats, religious bodies, or the king. The breakdown of feudalism, however, and redistribution of land did not necessarily lead to small farmers in the south winding up with land of their own or land they could work and profit from. Many remained landless, and plots grew smaller and smaller and thus more and more unproductive as land was subdivided among heirs.
A factory in Turin, set in 1898, during the period of industrialisation.
The Italian diaspora did not affect all regions of the nation equally. In the second phase of emigration (1900 to World War I) most emigrants were from the south and most of them were from rural areas, driven off the land by inefficient land management policies. Robert Foerster, in ''Italian Emigration of our Times'' (1919) says, " [Emigration has been]…well nigh expulsion; it has been exodus, in the sense of depopulation; it has been characteristically permanent."

''Mezzadria'', a form of sharefarming where tenant families obtained a plot to work on from an owner and kept a reasonable share of the profits, was more prevalent in central Italy, which is one of the reasons why there was less emigration from that part of Italy. The south lacked entrepreneurs, and absentee landlords were common. Although owning land was the basic yardstick of wealth, farming in the south was socially despised. People did not invest in agricultural equipment but in such things as low-risk state bonds.

Italian economic miracle



The Lingotto, once a huge automobile factory, built by Fiat. It was first opened in 1923 (after construction had begun in 1916) and finally closed 1982. It was, at its time, considered one of the most avant-garde and modern factories in Europe.
During the 1950s and 60s, Italy saw a transformation from being a weak, agricultural-based economy into one of the world's leading industrialized nations, an event known as the ''"Italian economic miracle"'', (or 'il boom'). John F. Kennedy, on his 1963 1–2 July visit to Rome and Naples, praised Italy's economic growth, on a dinner with the Italian President of the time, Antonio Segni. Migrants from the poor south came to the leading industrial centres of Italy, Milan and Turin, and these cities started to open up more factories and industrial districts. The release of the Fiat 500 and the construction of the Pirelli tower in Milan, were all events which symbolized Italy's growing economy. In the post-war period, Italy was transformed from a weak, agricultural based economy into one of the world's most industrialized nations, even so that in 1987, the Italian economy beat the British Economy by GDP (nominal), an event known to the Italians as 'il sorpasso (economics)'.

Recent times


Since 1991 on the subject of economic policy, Italy has focused primarily on reducing government budget deficits and reining in the national debt. Successive Italian governments have adopted annual austerity budgets with cutbacks in spending, as well as new revenue raising measures. Italy has enjoyed a primary budget surplus, net of interest payments, for the last 7 years. The deficit in public administration declined to 1.4% of GDP in 2000, down from 7% in 1995. Italy joined the Economic and Monetary Union in May 1998. The national debt, which stood at roughly 124% of GDP in 1995, declined steadily until about 2002, but is rising again because of slow growth. The deficit-to-GDP ratio is likely going to be higher than the EU limit of 3.0% in 2005, and estimates of up to 5.1% have appeared.

1999-2000 financial crisis


Italy entered an economic crisis in between 1999 and 2000, with GDP growth at about zero, although GDP has started to grow again as of 2005. Previously, Italy's economy had accelerated from 0.7% growth in 1996 to 1.4% in 1999 and continued to rise to about 2.90% in 2000, which was closer to the EU projected growth rate of 3.10%. Domestic demand and exports were the dominant factors in GDP growth, but it nevertheless remains one of the lowest among industrialised countries. Since 2002, growth has gradually slowed, reaching recession conditions. The opposition blamed Silvio Berlusconi's government
for incompetence, especially the minister of economy Giulio Tremonti. A report of the Economist, entitled ''Addio, dolce vita'' ("Farewell, sweet life") parallels current status of Italian economy to that of the Republic of Venice in 1797, a country with "many attractions" but living "a slow, long decline".

2008–2009 financial crisis


Industrial output in Italy has slumped 6.6 percent over the past year. Fiat announced plant closures and temporary layoffs at factories in Turin, Melfi and Sicily. Car sales in Italy have fallen by almost 20 percent over each of the past two months.Italy's car workers' union said, "The situation is evidently more serious than had been understood." On 10 July 2008 economic think tank ISAE lowered its growth forecast for Italy to 0.4 percent from 0.5 percent and cut the 2009 outlook to 0.7 percent from 1.2 percent. Analysts have predicted Italy had entered a recession in the second quarter or would enter one by the end of the year with business confidence at its lowest levels since the September 11 attacks. Italy's economy contracted by 0.3 percent in the second quarter of 2008. In December 2009 the unemployment rate reached 8.5%.

The Italian economy today



''FieraMilano'' complex in Milan by Massimiliano Fuksas: it is considered the largest exhibition center in Europe.
The Italian economy is one of the world's major economies, and its main industries are tourism, commerce, communications, chemicals, machinery, car manufacture, food, textiles, clothing, footwear and ceramics. Italy is a developed country, and, according to The Economist, has the world's 8th highest quality of life. However, the country suffers from many problems. During the last decade the average annual growth was 1.23% in comparison to an average EU annual growth rate of 2.28%. Italy has often been referred to as the ''sick man of Europe'', characterised by economic stagnation, political instability and problems in pursuing reform programs.

The Italian economy is weakened by the lack of infrastructure development, market reforms and research investment. In the Index of Economic Freedom 2008, the country ranked 64th in the world and 29th in Europe, the lowest rating in the Eurozone. The country has an inefficient state bureaucracy, low property rights protection and high levels of corruption, heavy taxation and public spending that accounts for about half of the national GDP. In addition, the most recent data show that Italy's spending in R&D in 2006 was equal to 1.14% of GDP, below the EU average of 1.84% and the Lisbon Strategy target of devoting 3% of GDP to research and development activities.

The cities of Milan and Rome are major European financial and political centres. The Milan metropolitan area has Europe's 4th highest city GDP (nominal), $312 (€241) billion, and the Rome metropolitan area has a GDP of €109 billion. Milan and Rome are also the world's 11th and 18th (respectively) most expensive cities in the world. Milan is Europe's 26th richest city by purchasing power in 2009, with a GDP of $115 billion. Milan has high GDP (per capita), about €35,137 (US$ 52,263), which is 161.6% of the EU average GDP per capita by country, whilst Rome had a 2003 GDP per capita of €29,153 (US$ 37,412), which was second in Italy, (after Milan), and is 134.1% of the EU average GDP per capita by country. Naples, in southern Italy, which is characterized by high levels of unemployment and organized crime, is the world's 91st richest city by purchasing power, with a GDP of $43 billion.http://www.citymayors.com/statistics/richest-cities-2005.html

Transport




Milan's Malpensa Airport.
A train in Val Pusteria.

In 2004 the transport sector in Italy generated a turnover of about 119.4 billion euros, employng 935,700 persons in 153,700 enterprises. Regarding to the national road network, in 2002 there were 668,721km (415,612mi) of serviceable roads in Italy, including 6,487km (4,031mi) of motorways, state-owned but privately operated by Atlantia company. In 2005, about 34,667,000 passenger cars (equal to 590 cars per 1,000 people) and 4,015,000 road good vehicles circulated on the national road network.

The railway network in Italy totals 16,862 kilometres in 2008, ranking the country 15th in the world, and is operated by Ferrovie dello Stato, of which 69% electrified, and on which 4,937 locomotives and railcars circulated. High speed trains include ETR-class trains, of which the ETR 500 travels at 300km/h (190mph). Nowadays the rail tracks and infrastructure are currently managed by the Rete Ferroviaria Italiana
In 1991 Treno Alta Velocità SpA was created, a special purpose entity owned by RFI (itself owned by Ferrovie dello Stato) for the planning and construction of high-speed rail lines along Italy's most important and saturated transport routes. These lines are often referred as "TAV" lines. The purpose of TAV construction is to aid travel along Italy's most saturated rail lines and to add tracks to these lines, namely the Milan-Naples and Turin-Milan-Venice corridors. One of the focuses of the project is to turn the rail network of Italy into a modern and high-tech passenger rail system in accordance with updated European rail standards. A secondary purpose is to introduce high-speed rail to the country and its high-priority corridors. When demand on regular lines is lessened with the opening of dedicated high-speed lines, those regular lines will be used primarily for low-speed regional rail service and freight trains. With these ideas realised, the Italian train network can be integrated with other European rail networks, particularly the French TGV, German ICE, and Spanish AVE systems.In 2005, about 34,667,000 passenger cars (equal to 590 cars per 1,000 people) and 4,015,000 road good vehicles circulated on the national road network. The national railway network, state-owned and operated by Ferrovie dello Stato, in 2003 totalled 16,287km (10,122mi) of which 69% electrified, and on which 4,937 locomotives and railcars circulated.

The national inland waterways network comprised 1,477km (918mi) of navigable rivers and channells in 2002. In 2004 there were approximately 30 main airports (including the two hubs of Malpensa International in Milan and Leonardo Da Vinci International in Rome) and 43 major seaports in Italy (including the seaport of Genoa, that is the country largest and the second largest in the Mediterranean Sea after Marseille). In 2005 Italy maintained a civilian air fleet of about 389,000 units and a merchant fleet of 581 ships.

Energy and Natural resources




Wind turbines near Frigento, province of Avellino, Campania.
Italy has few natural resources. With much of the land unsuited for farming, it is a net food importer. There are no substantial deposits of iron, coal, or oil. Proven natural gas reserves, mainly in the Po Valley and offshore Adriatic, have grown in recent years and constitute the country's most important mineral resource. Most raw materials needed for manufacturing and more than 80% of the country's energy sources are imported.

The energy sector is highly dependent on imports from abroad: in 2006 the country imported more than 86% of its total energy consumption (99.7% of the solid fuels demand, 92.5% of oil, 91.2% of natural gas and 15% of electricity).

Italy has built several nuclear reactors from 1963–1990, but after Chernobyl, the country stopped all work on its nuclear program. Currently, the majority of Italy’s electricity is produced gas, oil, coal, and hydro. Italy also imports about 16% of its electricity need from France for 6.5 GWe, which makes it the world’s biggest importer of electricity. Due to its reliance on expensive fossil fuels and imports, Italians pay approximately 45% more than the EU average for electricity.“Emerging Nuclear Energy Countries.” ''Australian Uranium Association.'' April 2008.

In 2004, a new Energy Law brought the possibility of joint ventures with foreign companies to build nuclear power plants and import electricity. Public opinion on nuclear power was positive, as Italy’s younger generations embraced nuclear energy. In 2005, Italy’s power company, ENEL made an agreement with Electricite de France for 200 MWe from a nuclear reactor in France and potentially an additional 1,000 MWe from new construction. As part of the agreement, ENEL received a 12.5% stake in the project and direct involvement in design, construction, and operation of the plants. In another move, ENEL also bought 66% of the Slovak Electric utility that operates six nuclear reactors. As part of this agreement, ENEL will pay the Slovak government EUR 1.6 billion to complete a nuclear power plant in Mochovce, which has a gross output of 942 MWe. With these agreements, Italy has managed to access nuclear power without placing reactors on Italian territory.

There was a uranium enrichment facility in Bosco Marengo, but which is being decommissioned by Sogin, a spinoff of ENEL.

The country was also ranked ranked as the world’s seventh largest producer of wind power with a total installed capacity of 2,726MWe in 2008, behind Germany, the United States, Spain, India, China and Denmark.[http://www.gwec.net/uploads/media/chartes08_EN_UPD_01.pdf Global installed wind power capacity (MW)] Global Wind Energy Council 6.2.2008

The north-south divide



In Italy there is a considerable north-south divide, where Northern Italy is dominated by a highly-developed and capitalistic economy, whilst Southern Italy is far less advanced and more based on agriculture and tourism. Even though this is slowly changing, since Southern Italy has had a strong economic growth and organized crime (e.g. Mafia, 'Ndrangheta or Camorra) levels have decreased, Northern Italy still remains the most industrialised and advanced area in Italy.

Northern Italy



Northern Italy is the wealthiest and most prosperous of Italian regions. Lombardy (GDP: € 311 billion (2006)[http://europa.eu/rapid/pressReleasesAction.do?reference=STAT/09/23&format=HTML&aged=0&language=EN&guiLanguage=en. EUROPA - Press Releases - Regional GDP per inhabitant in the EU27, GDP per inhabitant in 2006 ranged from 25% of the EU27 average in Nord-Est in Romania to 336% in Inner Londo...]), Lazio (GDP: € 161 billion (2006)), Veneto (GDP: € 140 billion (2006)),[http://statistica.regione.veneto.it/ENG/Pubblicazioni/RapportoStatistico2007/Capitolo01b.jsp#top Statistical Report 2007 - Chapter 1.2 - Production sectors] Emilia-Romagna (GDP: € 129 billion (2006)) and Piedmont (GDP: € 120 billion (2006)) are Italy's wealthiest regions. The cities of Milan, Turin and Genoa together form Italy's famous "''industrial triangle''",[http://www.nationsencyclopedia.com/Europe/Italy-INDUSTRY.html Industry - Italy] which is characterized by heavy industry, machinery, production and commerce. Also, the Province of Bolzano-Bozen is Italy's richest province GDP per capita (€32,900; 135.5% of EU average), followed by Lombardy (€32,800; 135.1% of EU average) and Emilia-Romagna (€30,700; 126.6% of EU average). Also, with Northern Italy having a 2007 nominal GDP estimated in €834.7 billion, Northern Italy accounts for almost 54% of the national economy.

Southern Italy



Naples has had a rapid post-war economic growth (the picture shows tha avant-garde Centro Direzionale, designed by Japanese architect Kenzo Tange).
Southern Italy is the country's less affluent and less prosperous area. Even though cities in the Southern part of the peninsula (such as Naples) have had a remarkable economic growth in the post-war period, there are problems such as high unemployment, corruption, inefficient levels of bureaucracy, tax evasion and organized crime (the Sicilian Mafia, Camorra and 'Ndrangheta are all based in regions of Southern Italy).T. Astarita, Between Salt Water and Holy Water: A History of Southern Italy, 2005

Although southern Italy was less affluent than northern Italy throughout modern history, at times southern Italy had prosperous and advanced areas, culturally and economically wealthier than northern or central Italy, mainly prior to the Renaissance. Southern Italy was a leader in European cultural and political affairs. The Norman Kingdom of Sicily was prosperous and politically powerful, becoming one of the wealthiest states in Europe.

In the 11th and 12th centuries, Sicily and the Kingdom of Naples played a major role in European affairs and exhibited many signs of prosperity. By the middle of the 13th century, due to fiscal policies that prevented the growth of a strong merchant class, the region became economically backward compared to the other Italian states.Benedetto Croce, History of the Kingdom of Naples, 1970 Unlike the rest of Italy, which experienced the rise of many small, independent and prosperous city states, all enterprise in the comparatively large kingdom centred on the capital city of Naples. The outlying areas, cursed with generally poor agricultural conditions, fell further behind. Sicily's trade fell primarily under Catalan control and by the 14th century finances of the kingdom fell primarily into Tuscan hands. With the Spanish conquest, the kingdom continued to be repressed and exploited by foreign rule until the late 18th century and even when Bourbon rule meant a native court and a time of enlightenment for some sectors of the society.

According to some historians, during the time of the Bourbons the area around Naples became relatively productive. It was the first place in Italy to build a railway, even though it was mainly for royal (not commercial) use, and the local manufacturing base was growing. Following unification with the rest of the Italian peninsula in 1861, factory technology (which the Kingdom of the Two Sicilies had gained from the British) was taken away to Piedmont, Lombardy and Liguria.

After unification southern Italy experienced a huge demographic expansion which provoked mass emigration, especially between 1892 and 1921. In addition, corruption was such a large problem that the prime-minister Giovanni Giolitti once conceded that places existed "where the law does not operate at all".

One study released in 1910 examined tax rates in north, central and southern Italy indicated that northern Italy with 48% of the nation's wealth paid 40% of the nation's taxes, while the south with 27% of the nation's wealth paid 32% of the nation's taxes.

After the rise of Fascism, Benito Mussolini set himself the task of defeating the already powerful criminal organizations flowering in Sicily and the South. Economically, Fascist policy aimed at the creation of an Italian empire and Southern Italian ports were strategic for all commerce towards the colonies. Naples enjoyed a demographic and economic rebirth, mainly thanks to the interest of the King Victor Emmanuel III who was born there.

During the 1950s, the regional policy the Cassa per il Mezzogiorno was set up to help raise the living standards in the South to those of the North. The Cassa aimed to do this in two ways: by land reforms creating 120,000 new small farms, and through the "Growth Pole Strategy" whereby 60% of all government investment would go to the South, thus boosting the Southern economy by attracting new capital, stimulating local firms, and providing employment. As a result the South became increasingly subsidized and dependent, incapable of generating growth itself.

Even today, regional disparities persist. Southern Italy continues to be the least prosperous area of Italy. Problems still include corruption, organized crime and high unemployment. Southern Italy includes 37% of Italy's population, occupies 40% of its land area, but only produces 24% of its gross domestic product. This does not, however, include the large underground black economy reported to be as high as 30% of GDP.[http://www.crvp.org/book/Series04/IV-2/chapter_iii.htm Southern Italy at the Millennium: The Outlook for Southern Italy in the Year 2000, by Clark N. Ellis]

During the 1940s, 50s, 60s and 70s, the economy of southern Italy has had a remarkable growth. Unemployment has been decreasing, since the 2003 contreversial "''Biagi law''", as unemployment in Campania has fallen from 23.7% in 1999 to 11.2% in 2007, and in Sicily from 24.5% to 13%.

Today, Southern Italy has Italy's lowest GDP per capita, that of € 16,300-16,600 in 2006,[http://europa.eu/rapid/pressReleasesAction.do?reference=STAT/09/23&format=HTML&aged=0&language=EN&guiLanguage=en EUROPA - Press Releases - Regional GDP per inhabitant in the EU27, GDP per inhabitant in 2006 ranged from 25% of the EU27 average in Nord-Est in Romania to 336% in Inner Londo...] and a 2003 GDP nominal of US$369 billion. The area's richest region, Campania, has a GDP nominal of € 94.3 billion in 2006, and a GDP per capita of € 16,294.

Regional differences



A chart showing the different GDP per capita distribution amongst Italian regions:



Banking in Italy



The Banca Commerciale in Milan.

Banking in Italy has, as of the 11th October 2008, an average assets/liabilities ratio of 12 - 1, while the banks's short-term liabilities are equal to 86% of the Italian GDP or 43% of the Italian national debt.

This is a list of the top 5 Italian banks ranked by market capitalization.

(According to Il Sole 24 ore, 31 July 2007)


Economical statistics





Tourism




A view of Florence, one of Italy's most popular destinations for tourists.
Tourism is one of the fastest growing and most profitable sectors the national economy: with 43.7 million international tourist arrivals and total receipts estimated at $42.7 billion, Italy is the fourth highest tourist earner in the world. Italy is the fifth most visited country in the world, behind France (76.0 million), Spain (55.6 million), United States (49.4 million), and China (46.8). Despite a slump in the late-1980s and during the Persian Gulf War, Italy has, eversince the mid-1990s, rebuilt a strong tourist industry.http://www.britannica.com/EBchecked/topic/297474/Italy# People mainly come to Italy for its rich art, cuisine, archaeology, history, fashion, and culture, its beautiful coastline and beaches, its good Mediterranean weather, its mountains, its lakes, and priceless ancient monuments, especially those from the Greek civilization and Roman civilization.

Nowadays, Rome, Italy's capital, is one of the most visited cities in the world, with an average of 7-10 million tourists a year. The Colosseum (4 million tourists) and the Vatican Museums (4.2 million tourists) are the 39th and 37th (respectively) most visited places in the world, according to a recent study. Other main sights in the city include the Pantheon, the Trevi Fountain, Piazza Navona, St Peter's Basilica, the Roman Forum, Castel Sant'Angelo, the Basilica of St. John Lateran, the Spanish Steps, Villa Borghese park, Piazza del Popolo, the Trastevere and the Janiculum.

Other visited cities and popular destinations in Italy include Venice, Florence, Milan and Naples, and also the Amalfi Coast, the Sicilian coastline and Mount Etna, Pompeii and Mount Vesuvius, the Ligurian coastline, the Italian lakes (such as Lake Como, Lake Maggiore and Lake Garda), the Palladian Villas of the Veneto and the Leaning Tower of Pisa, to name but a few.

Automobile Industry




A Ferrari 599 GTB Fiorano. Ferraris are amongst Italy's most iconic supercars.
Car companies such as Fiat, Alfa Romeo and Ferrari are based in Italy. Pictured here is the Alfa Romeo 147.
With a contribution to the national GDP of 8.5%,
and a workforce of 200,000 or more,The International Organisation of Motor Vehicles Manufacturers estimated that 196,000 people were directly employed in auto and parts production in 2004, while according to italtrade.com nearly 250,000 were employed by the 2,131 firms in the parts sector alone in 2006:

the automotive industry forms a significant component of the Italian economy. The country is the 5th largest automobile producer in Europe (2006).

The industry is almost totally dominated today by Fiat Group which produced over 90% of vehicles manufactured in 2001 and whose brands include Fiat, Lancia, Iveco, Bertone, Maserati, Ferrari and Abarth. Italy's car manufacturers are known for the quality of design which is applied across the range from small city cars, through sportscars to the supercars produced by Ferrari, Maserati, Lamborghini (part of the Volkswagen Group), and the independent Pagani..

Sectors



Primary


A vineyard in Trentino Alto-Adige. Italy is one of the world's top wine producing and exporting countries.
The northern part of Italy produces primarily grains, rice, maize corn, sugar beets, soybeans, meat, fruits and dairy products, while the south specializes in producing fruits, vegetables, oil and durum wheat. Italy, depending on the year, is the first or the second largest producer of wine in the world.[http://faostat.fao.org/site/567/DesktopDefault.aspx?PageID=567 Food and Agriculture Organization of the United Nations data]

Italy, depending on the year, is the first or the second largest producer of wine in the world and one of the leading in olive oil, fruits (apples, oranges, lemons, pears, apricots, peaches, cherries, strawberries, kiwi), flowers and vegetables.

According to the Agriculture Census, there were 2.6 million farms in 2000 (down from 3 million in 1990,) covering 19.6 million hectares. The vast majority (94.7%) are family-operated and small, averaging only 5 hectares in size. Of the total surface area in agricultural use (forestry excluded,) grain fields take up 31%, olive tree orchards 8.2%, vineyards 5.4%, citrus orchards 1%, other orchards 3.8%, sugarbeets 1.7%, and horticulture 2.4%. The remainder is primarily dedicated to pastures (25.9%) and feed grains (11.6%.) Livestock includes 6 million head of cattle, 8.6 million head of swine, 6.8 million head of sheep, and 0.9 million head of goats.

The most famous Italian wines are probably the Tuscan Chianti and Piedmontese Pinot Grigio. Other famous wines are Barbaresco, Barolo and Barbera (Piedmont), Brunello di Montalcino (Tuscany), Montepulciano d'Abruzzo (Abruzzo) and Nero d'Avola (Sicily). Quality goods in which Italy specialises are often DOC or 'of controlled origin'. This DOC certificate, which is attributed by the European Union, ensures that the origins and work that goes into a product are recognised. This certification is considered important by producers and consumers alike, in order to avoid confusion with low-quality mass-produced ersatz products, such as Cambozola, a German copy of Gorgonzola.

Eni's headquarters in EUR, Rome's business district. Eni is Italy's biggest company and the world's 18th

Industry


Industrial sectors have long been concentrated in northern areas of Piemonte, Lombardia, and Veneto. The region supplies easy access to the rest of Europe, hydroelectricity from the Alps, and workable, flat land. The FIAT factory, for example, is located in Turin. Most Italian industrial companies, often of small size, are located in the "industrial triangle" (Milan, Turin, Genoa) and in some centres of northeast and Emilia Romagna.

Italy has a smaller number of world-class multinational corporations than other economies of comparable size, but there are a large number of small and medium companies, which has produced a manufacturing sector often focused on the export of niche market and luxury products, capable of facing the competition from China and other emerging Asian economies based on lower labour costs.

Italy's economic strength is also in the processing and the manufacturing of goods, primarily in small and medium-sized family-owned firms. The country has been less successful in terms of developing world class multinational corporations. In addition, the small and medium-sized firms typically manufacture products that are technologically moderately advanced and therefore increasingly face crushing international competition. However, Italy's Institute for Foreign Trade, has initiated the ''"Machines Italia"'' program, in conjunction with leading Italian machinery manufacturers' associations to promote Italian manufacturers' recognized attributes for creativity, flexibility and innovation in bringing customized solutions to their clients. Currently the Machines Italia program operates in various foreign markets as the United States, Canada and Mexico.

Exports



Italian exports in 2005.
Italy's major exports are precision machinery, motor vehicles (utilitaries, luxury vehicles, motorcycles, scooters), chemicals and electric goods, but the country's more famous exports are in the fields of food and clothing. Italy has the world's 6th highest exports, US$ 546,900,000,000 (est.) in 2008, and the world's 24th highest petroleum exports, which were US$ 521,400 in 2004.https://www.cia.gov/library/publications/the-world-factbook/rankorder/2176rank.html

Italy's major exports are motor vehicles (Fiat Group, Aprilia, Ducati, Piaggio); chemicals and petrochemicals (Eni); energy and electrical engineering (Enel, Edison); home appliances (Candy, Indesit), aerospace and defense technologies (Alenia, Agusta, Finmeccanica), firearms (Beretta), fashion (Armani, Valentino Fashion Group, Versace, Dolce & Gabbana, Roberto Cavalli, Benetton, Prada, Luxottica); food processing (Ferrero, Barilla Group, Martini & Rossi, Campari, Parmalat); sport and luxury vehicles (Ferrari, Maserati, Lamborghini, Pagani); yachts (Ferretti, Azimut); ceramic tiles (Marazzi, Florim, Iris Ceramica).

Italy's closest trade ties are with the other countries of the European Union, with whom it conducts about 59% of its total trade. Italy's largest EU trade partners, in order of market share, are Germany (12.9%), France (11.4%), and Spain (7.4%).

Labour



Following the 2003 "''Biagi law''", a controversial labour reform, unemployment has been steadily decreasing, reaching 6.2% in 2007, the lowest rate since the 1970s. In the south the average unemployment rate is far higher than the national average, but, in recent years, progress was made nonetheless, with the unemployment rate falling from 23.7% in 1999 to 11.2% in 2007 for Campania, and from 24.5% to 13% for Sicily. There is a significant underground economy, especially in the south where it partially offsets the high official unemployment rate, absorbing substantial numbers of people, working for low wages and without standard social benefits and protections.

Unions claim to represent 40% of the work force. Most Italian unions are grouped in three major confederations: the CGIL, the CISL, and the UIL, which together claim 35% of the work force. These confederations formerly were associated with important political parties (respectively the Italian Communist Party, the Christian Democracy and the Italian Socialist Party), but they have formally terminated such ties. Nowadays, the three often coordinate their positions before confronting management or lobbying the government. The three major confederations have an important consultative role on national social and economic issues. Among their major agreements are a 4-year wage moderation agreement signed in 1993, a reform of the pension system in 1995, and an employment pact, introducing steps for labor market flexibility in economically depressed areas, in 1996. The CGIL, CISL, and UIL are affiliates of the International Trade Union Confederation. Of the three unions, CGIL is the strongest in numbers. CGIL once single-handedly organized a three-million people rally in Rome. Italy's employers are represented by Confindustria, the Italian Employers' Federation.

Billionaires and millionaires




A quarterly report prepared by the Economist Intelligence Unit on behalf of Barclays Wealth in 2007 estimated that there were 2,800,000 dollar millionaires in Italy. The richest man in Italy is Michele Ferrero, who, according to ''Forbes'', has a net worth of US$ 9.5 billion. Other billionaires include Giorgio Armani, Miuccia Prada, Ennio Doris, the Benetton family, the Agnelli family and Silvio Berlusconi, to name but a few. In total, Italy has Europe's fifth greatest number of billionaires (12), coming after Germany, Russia, the UK and Turkey, and surpassing Spain, France, Sweden and Switzerland.


Source: Wikipedia