Press Review #SoseXpress 24-30 July 2021

The first resources of the Next Generation program are about to arrive from the European Union. The planned interventions and reforms must now become a reality. We cannot fail: it is a test that concerns the whole country without distinction. 

The President of the Republic, Sergio Mattarella, on the traditional "fan" ceremony. 

The debate of ideas 

 

Greening monetary policy 

According to several studies climate risks should now be an essential part of financial risk assessment. It is a fact that the Internal Capital Adequacy Assessment Processes (Icaap) take climate change-scenarios into account when assessing long-term assets and liabilities. Estimating ex-ante the effect of future climate policies, would facilitate the implementation of the regulatory measures taken in this direction. In this context, "the ECB announced its commitment to include considerations on climate change in its strategic choices. But how and why should a central bank deal with environmental sustainability?". Here a detailed article on La Voce.info 

 

Green and digital transition, 5G is the key to the national ecosystem. 

If we want to innovate our country into a smart country and fill the gap with the most technologically advanced countries, we must translate our commitment to sustainability into effective action. According to the NRRP, 5G will be the main ingredient of the green and digital recipe. It will allow Italy to regain competitiveness and reduce the gaps with the most advanced economies, improving the quality of innovative services, crucial for creating a national ecosystem. The event " Pensare Sostenibile: smart Italy, slow life " highlighted the opportunities offered by the PNRR, fundamental to complete the development of digital infrastructures throughout the country. Here to learn more. 

 

Studies, research and numbers 

 

Italy, GDP up by 2.7% in the second half of the year, well above expectations

In the second quarter of 2021, Istat estimated that Italian seasonally and calendar adjusted GDP increased by 2.7% compared to the previous quarter and by 17.3% over the same quarter of the last year. Istat's estimate is significantly higher than analysts' expectations of 1.3% on a quarterly basis. The carry-over annual GDP growth for 2021 is 4.8%, only slightly lower than the forecasts of the government, the European Commission, and the Bank of Italy, estimating a GDP increase of around 5%. Here the note by Istat. 

 

Istat: in June employment up by +166 thousand units and unemployment at 9.7% 

In June 2021, the number of employed persons increased, while a decline was recorded for both unemployed and inactive people. According to Istat, employment began to grow in February 2021 and strengthened in the sixth month of the year  (in the first five months, it increased by 400 thousand units). However, the number of employees is still lower by over 470 thousand units compared to February 2020, the month before the pandemic outbreak. The growth in employment in June (+ 0.7%, equal to +166 thousand units) involved men, women, employees, self-employed, and all age classes. The employment rate went up to 57.9% (+0.5 points). Here the note by Istat. 

 

Svimez: recovery only in the Centre-North, the South lags behind 

The Centre-North will fully recover the GDP lost in 2020 only in 2021-2022, reaching pre-crisis levels. The South is lagging and will still have about 1.7% of GDP to recover at the end of 2022. According to the 2021 Svimez Report, " L'economia e la società del Mezzogiorno (The economy and society of the South)," in the year of Covid, the fragmentation of development policies, which has strengthened over the last 20 years, affects not only the South. The NRRP should pay particular attention to this problem since only public policies involving all regions will fill the existing gaps. Here for more information. 

 

Eurostat: Household real consumption per capita continues decreasing in both euro area and EU  

According to the latest report published by Eurostat, in the first quarter of 2021, the household real per capita consumption decreased by 1.6% in the euro area after declining by 2.6% in the previous quarter. Household real income per capita increased in the first quarter of 2021 by 0.4%, after a decrease of 0.8% in the fourth quarter of 2020. Here the Eurostat Press Release section. 

 

Istat: Italian quality products recognized by the EU continue to grow 

The number of excellences in the Italian quality agri-food sector is growing. According to the report published by Istat, in 2019, PDO (Protected Designation of Origin), PGI (Protected Geographical Indication), and TSG (Traditional Specialty Guaranteed – Italian acronym Stg) products amounted to 300 including PGI extra virgin olive oil from Puglia. The share of Dop, Igp, and Tsg operators in the South is 41.2%, while female operators are 15.7% (of which 31% in the extra virgin olive oil sector). Here the note by Istat. 

 

Intesa Sanpaolo: gold industry, world demand up by 52% in the first quarter of 2021 

Italian exports are growing by 1.4% in value and 12.5% in quantity, thanks to the good performance of the main commercial outlets. After the sharp drop (-35%) in 2020, , the global demand for gold jewellery grew in the first quarter of 2021. Sales increased by 52% in quantity thanks to the recovery, especially in China. A Report realized by Intesa Sanpaolo underlines how the Italian gold industry is recovering confidence, even though the most significant rebound was recorded on the Chinese market (+ 211%). The main markets for Italian exports are Russia (+ 10%), Hong Kong (+ 9.5%), and the United States (+ 6.4%). Here the note by the Intesa Sanpaolo Groups. 

 

Istat: Imports up by + 1.2%, exports by 0.1% in June 

According to Istat estimates, the trade balance with non-EU27 countries registered a surplus of 4.790 billion in June 2021 (4.676 billion in June 2020). Regarding non-energy products, the surplus increased from +6.265 million in June 2020 to +7.517 million in June 2021. Istat highlights that in June 2021, trade with non-EU countries grew in both flows, more for imports (+ 1.2%) than for exports (+ 0.1%). The upward trend in exports is mainly due to the increase in sales of intermediate goods (+ 6.1%) while those of capital goods decreased (-4.5%). Here the note by Istat. 

 

Coldiretti, food is Italy's top wealth with 25% of GDP

In his speech at the United Nations pre-Food System Summit in the session dedicated to "From the G20 Matera Declaration to the Food Systems Summit: A Framework for Emerging Coalitions of Action," Ettore Prandini, Coldiretti president, highlighted that, during the pandemic emergency, sales of agri-food products reached 25% of our national GDP. With 538 billion euro, food has become the main asset of the Italian economy. In detail, the whole agri-food chain from farm to table involves 4 million workers employed in 740,000 farms, 70,000 food industries, over 330,000 catering enterprises, and 230,000 retail outlets. These impressive numbers make agri-food the flagship of the Italian economy. Here the Coldiretti press release. 

 

Istat: In 2020, primary income inequality decreased among Italians

According to Istat microsimulation model, in 2020, public intervention, through tax and social security contributions and monetary transfers, reduced the Gini coefficient by 14.1%: from a value of 44.3 points measured on primary income to 30.2 in terms of disposable income. Social security pensions (disability, old age, survivors) are the main redistributive measure. Other support allowances increased significantly in 2020 to support employment ( Wages Guarantee Fund – Italian acronym Cig), and family (Citizenship Income - Italian acronym RdC). Furthermore, Istat estimates that the extraordinary measures implemented in 2020 (emergency income, allowances for self-employed workers, and domestic workers) contributed to support household incomes, heavily affected by the economic crisis, and reduced inequality. The Gini index decreased from 31.8 to 30.2 and the risk of poverty from 19.1 to 16.2%. Here the note by Istat.

 

IMF revises estimates upward for Italian GDP. But the Covid variants could cost 4.5 billion of GDP

The 2021 growth forecasts for the world economy have remained unchanged compared to the Economic Outlook of April 2021; estimates for 2022 have been revised upwards by 0.5 percentage points. The International Monetary Fund updated the World economic outlook. In Italy, after the contraction of 8.9% in 2020, GDP is expected to grow by 4.9% this year, 0.7 percentage points more than the 4.2% in April. In 2022, the Italian economy is expected to grow by 4.2%, 0.6 percentage points more than the April forecasts. Italy runs more than Germany, where GDP should grow by 3.6% this year and by 4.1% next. According to IMF, the risks to the global economic recovery are decreasing even though more widespread access to vaccines could improve the indices. However, "The new variants could hinder recovery and cost $ 4.5 billion of GDP by 2025." Here the press release of the International Monetary Fund. Here the forecasts published on La Voce.info.

 

Istat: In July, business and consumer confidence rose to an all-time high 

According to Istat estimates, in July, the business confidence climate index increased from 112.8 in the previous month to 116.3, the highest value in the entire historical series (the index has been calculated since March 2005). The consumer confidence index increased from 115.1 to 116.6 in July, the highest level since September 2018. The improvement was due to the rise of the economic, personal and current components; less favourable signals came from the future climate index, which decreased from 125.5 to 123.5. Regarding enterprises, Istat forecasts an improvement in the confidence climate in all sectors. Here the note by Istat. 

 

The voice of Stakeholders 

 

Congiuntura Flash: Italy is recovering driven by consumption and services, but the risk of contagion is growing 

The Confindustria Study Center, in the report "Congiuntura Flash," estimates for Italy a strong rebound in GDP in the 2nd quarter of 2021, weaker in the 3rd and 4th quarter. In June, the acceleration of vaccinations and the easing of restrictions supported the growth. Services and consumption drove the recovery, and electricity consumption confirmed the increasing industrial activity. However, there are concerns about the Delta variant that could stop tourism. In July, the increase in infections throughout Europe could cool the economic activity down, especially tourism and, particularly, from August, due to a lack of confidence and new anti-Covid measures. Here the note by the Confindustria Study Centre. 

 

Innovation 

 

B20: digital technologies will drive 60% of world GDP by 2022 

Digital transformation is increasingly becoming a global engine of sustainable economic growth, with 60% of world GDP driven by the digital industry by 2022. Furthermore, technology also represents a fundamental lever in the fight against climate change, reducing up to 15% the global CO2 production by 2030. The B20-G20 Dialogue on digital transformation focused on these premises, in view of the G20 meetings on Innovation and research on 5 and August 6 in Trieste. The meeting also revealed that the Digital transformation task force had prepared a library of use cases for innovative services. Here to learn more. 

 

Drones: In 2020, the sector decreased by 38%, and the market stopped at 73 million euro

According to the Drone Observatory of the School of Management of the Politecnico di Milano, in 2020, the health emergency affected the drone sector severely, after the significant growth recorded in 2019 (+ 17% compared to 2018). 48% of the companies reduced their activities, while 21% closed. In the year of Covid, the Observatory continues, the professional drone market (B2b and B2g) decreased from a value of 117 million euros to a total of 73 million euros, with a decline of 38%. However, the sector has held up and looks to the future with optimism: 80% of companies are confident in the market growth in the next three years, and 50% are beginning to consider it as a mass market. Here for more information. 

MISE: EuroHPC, 17.7 million in subsidized loans for the high-performance computing sector 

The Ministry of Economic Development will finance innovative projects of Italian companies in supercomputing and data processing through high-tech microprocessors by 17.7 million euros. The beneficiaries are the companies selected in 2020 by the European High-Performance Computing joint undertaking, which is part of the industrial strategy of the European Union. EuroHPC is a joint initiative between the EU, European countries, and private partners to develop a world-class supercomputing infrastructure and support cooperation in advanced scientific research. Here the press release by MISE. 

 

Cybersecurity, IoT devices under attack, + 700% increase in malware 

Since the pandemic outbreak, breaches in corporate network protection increased by 700% compared to the pre-pandemic figures, 300,000 in just two weeks. Hackers targeted the technology, manufacturing, retail, and healthcare sectors. Zscaler, a leader in cloud security, published a new study investigating the state of IoT devices connected to corporate networks in the period in which companies had to adopt rapidly and widely remote working. The study analysed over 575 million device transactions and 300,000 malware attacks against IoT devices blocked by Zscaler in two weeks in December 2020. These attacks targeted 553 different devices, including printers, digital signage solutions, and smart TV, all connected and communicating with corporate IT networks while many employees were working remotely during the Covid-19 pandemic. Here to learn more. 

 

Cybercrime: lives at risk. And the financial impact will exceed $ 50bn. 

By 2025, Cybercriminals will have weaponized operational technology (OT) environments, posing a risk to human life. According to Gartner, a world-leading company in strategic consulting and information technology analysis, attacks on OT, hardware, and software that monitor or control equipment, resources, and processes, have become more common. They have progressed beyond causing immediate process disruption, like shutting down a plant to jeopardize industrial environments' integrity to cause physical harm. The company predicts that the financial impact of attacks on cyber-physical systems (CPS) with fatal victims will exceed $ 50 billion by 2023. Even without taking the value of human life into account, the costs for organizations in terms of compensation, litigation, and insurance will be high. Here to learn more. 

 

Manufacturing 4.0, the challenge of the Industrial Smart Working has begun. But investments stagnate

According to the latest Mecspe Observatory on the second quarter of 2021 presented by Senaf, seven out of ten companies (69%) of the Italian manufacturing industry expect an increase in turnover by the end of 2021 compared to last year. In a context of increasing economic recovery, the general business confidence is also improving (54% of companies), and more significant investments in Industry 4.0 projects are crucial for growth and competitiveness. In the future digitization, sustainability, and training will be the main trends and will generate the long-awaited cultural change that manufacturing needs. According to the report, the pandemic has convinced entrepreneurs to invest in innovative technologies and processes, focusing on cybersecurity, 5 / G connectivity, the Internet of Things, and collaborative robotics. However, so far, only 8% of companies have taken these realities into account, and many do not know them (46%). Here to learn more.

 

Gender equity 

 

B20-G20 Dialogue on Women Empowerment 

Bringing a growing number of women back to the labour market, breaking down cultural barriers in accessing STEM training for girls, achieving gender equality in leadership positions are issues discussed during the B20-G20 Dialogue on Women Empowerment. "During the first wave of the pandemic, female employment shrank by 2.2 million across the European Union and women saw their earnings drop by nearly two-thirds faster than men, a drop of 16.5 % on average since the start of the pandemic. Furthermore, prejudices and cultural barriers keep women out of STEM sectors: only 7% choose to study engineering, mathematics, statistics, and natural sciences compared to 22% of men, only 14% of women work in cloud computing and 32 % deals with Artificial Intelligence ". Here is a video on the B-20-G20 Dialogue. 

 

 Local Authorities 

 

State-city conference and local autonomies: the criteria for allocating the 660mln Euro Fund 

Agreement reached with Anci and UPI on the allocation criteria regarding the 660-million-euro fund destined to municipalities with a deterioration of the administrative deficit on 31 December 2019. During the extraordinary session of the State-city and local autonomies Conference, chaired by Minister of the Interior Luciana Lamorgese, with the Minister of Economy and Finance, the parties reached an agreement on the decree relating to the allocation of the 660-million-euro fund for 2021, established by the so-called "Sostegni bis " decree. Here the note by MEF. 

 

The world of MEF 

 

 

Mef: credit and liquidity for households and businesses, still active moratoriums on loans for 79bn 

According to the survey carried out by the task force for the implementation of the measures to support liquidity during the Covid-19 emergency (including Mef, Mise, Bank of Italy, ABI, Mediocredito Centrale, and Sace), moratoriums are still active on loans for about 83 billion, based on 800 thousand suspensions granted. Sixty-four billion concern ex lege moratoriums in favour of SMEs, which amounted to 103 billion in the last survey (referring to mid-June). The reduction of almost 40 billion is due to the failure of the borrowers to request an extension. Requests for guarantees on new bank loans for micro, small and medium-sized enterprises submitted to the Guarantee Fund for SMEs exceed 184 billion. "Garanzia Italia" of SACE granted guarantees on loans for € 26.4bn, out of 2,704 requests received. Here the press release by MEF.