Despite the persistence of an unfavorable international situation, Italian and Chinese entrepreneurs see good growth prospects for economic cooperation between Italy and China. This was revealed by the report "China-Italy: what prospects for businesses", edited by the Study Center of the Italy China Council Foundation and presented today during the Italy China Economic Cooperation Forum, which was held in Milan. The event was attended by representatives of institutions and important Italian and Chinese businesses.
The Forum was held a few days after the bilateral meeting at the G20 in Bali between Prime Minister Giorgia Meloni and President Xi Jinping, concluded with the announcement of a forthcoming visit by our prime minister to China, and constituted a opportunity for discussion between operators in the sector to take stock of the economic and commercial relations in which the two countries are protagonists.
“The current historical moment is very complex but the signals that come to us from politics and economy allow us to look to the future with confidence – said Mario Boselli, ICCF President -. Despite the obvious difficulties of a global economy in crisis, the message we receive from companies is a great desire to collaborate. In particular, we are launching an appeal from our companies for China to reopen: going there is essential not only to make existing businesses work but above all to start new ones and to be able to build relationships with Chinese counterparts. A message that we have been repeating for some time and that needs to be urgently grasped so that dialogue and exchange do not take steps backwards".
NUMBERS 2022_ The positive growth of China-World trade continues in the first ten months of 2022 (+8% y/y), driven above all – with ups and downs – by the export component (+11% y/y) in first half, while significant slowdowns were recorded in the third quarter of the year. This is confirmed by the data for October, with Chinese exports and imports to the world recording a contraction of 0.3% and 0.7% respectively y/y. The resilience of exports has supported China's economic recovery over the past two years thanks to strong international demand, but the favorable situation seems to have slowed down. The conflict in Ukraine, weak external demand due to rising inflation resulting from soaring commodity prices and the slowdown in Chinese production capacity as a result of the closures due to Covid-19 weigh heavily. Of note is the sustained growth of Chinese exports to ASEAN countries in October (+20% y/y), against a drastic drop in exports to the United States (-12.6% y/y) and the European Union (-9% y/y).
In 2022, the data portray an Italian trend in trade relations with China in line with those of other European countries. Overall, trade in the first ten months of the year grew by 9% y/y, driven by Chinese exports to the Peninsula (+23% y/y equal to 43 billion dollars), while imports recorded a drop y/y of 10% (23 billion). A marked increase in the imbalance of the balance of payments with China should already be noted in 2021, attributable to the recovery and generalized increase in Italian imports towards and beyond pre-pandemic levels, thanks to a pronounced recovery in economic activity and domestic consumption. This trend was accentuated in 2022 due to the further rise in the prices of natural gas and energy, especially the share coming from the non-euro area.
COMPANIES: CONVERGENCE AND DIVERGENCY_ The third edition of the survey, contained within the report, saw the involvement of Chinese companies operating with Italy for the first time. The decision to include a sample of Chinese companies stems from the desire to understand what are the needs and problems they face in working with Italy and to bring out, where possible, similarities and differences with their Italian counterparts. The survey, anonymously, saw the overall participation of a heterogeneous sample of companies from various sectors, of which 75% Italian and 25% Chinese.
The analysis - based on over8,000 responses received - shows that if Italian entrepreneurs look to China as an "outlet market" for their products and services as well as a regional hub for accessing neighboring markets, their Chinese colleagues do the same – who see Italy as an area of interest for their investments because it is considered a key reality in the development of R&D activities thanks to the high level of qualification of its workforce. 84% of both samples declare themselves satisfied with their activities, while 60% have no plans to reduce or change their investment plans. Also in common are the critical issues experienced in the Covid-19 era: the impossibility of traveling and the difficulties in obtaining visas and residence permits, together with the interruption of supply lines.
To separate the experiences of the interviewees, the difficulties of accessing the two countries. If for the Italian champion to complicate the landing in China are above all the policies for managing the pandemic, the geographical distance, the logistical difficulties and the protection of intellectual property rights, for the Chinese one the problems are our unclear regulation, the bureaucracy inefficient and growing protectionism. On the other hand, linguistic-cultural difficulties are common and in the first place.
The survey made it possible to draw up a series of recommendations for Italian and Chinese institutions, including the request made by Italian companies to the EU to strengthen economic cooperation with strategic non-European partners, while maintaining a solid relationship with China, push internationalization processes, better protect intellectual property, and also greater investments in digital, aid to facilitate the emergence of strategic collaborations with local partners, as well as more training, information and the possibility of joint cooperation in the field of R&D.