#SoseXpress - Press Review 16/22 october 2021

Italy can demonstrate that support for the economy, encouraged by common policies, can strengthen the euro area. 

The Governor of the Bank of Italy, Ignazio Visco, during the World Savings Day.

The debate of ideas 

Global market and relocation, the "hangover" is over

After twenty years of relocations, the pandemic has accelerated the reshoring process, or rather the return of the national manufacturing from countries outside national borders. This process has been underway for several years. Various causes are driving companies to return to their homeland. First of all, the price advantages due to the reduced labour cost in the countries where relocations occur are always lower. Then the development of industry 4.0 with robots, 3D printing, the internet of things, and cloud computing reduce the presence of low-level and low-cost labour in companies. Today, however, in addition to these causes, Covid 19 has highlighted the risks of blocking or slowing down supply chains. During the pandemic, delays in deliveries of many goods caused serious difficulties for Western countries. Now reshoring is necessary and strategic. Here to learn more.

Studies, research and numbers 

Confindustria: GDP up by 6.1% in 2021 

The Italian GDP will grow by 6.1% in 2021 and 4.1% in 2022. In its forecast report Confindustria explains that broad upward revision is due to the reduced impact of the Covid Delta variant thanks to the effective vaccination campaign in Italy, which allowed to ease the containment measures. According to the Confindustria Study Centre, the robust restart of GDP, equal to over 10% in two years after a decrease of almost 9% in 2020, will bring our economy back to above pre-crisis levels in the first half of 2022, in advance of initial expectations. However, Confindustria continues, although the recovery is proceeding faster than elsewhere, now, the gap with the pre-pandemic period is even wider than in other main partners because the 2020 decline was more severe in Italy. Here to learn more. 

Istat: in 2019, the worth of the underground economy was 183.4 billion 

According to ISTAT, in 2019, the unobserved economy was worth 203 billion euros, equal to 11.3% of GDP. Compared to 2018, it decreased by over 5 billion (-2.6%), confirming the trend since 2014. Istat underscores that the underground economy sector amounts to slightly more than 183 billion euros, while illegal activities exceed 19 billion. According to Istat almost all the components of the unobserved economy showed a contraction: the value-added hidden by unreported income decreased by 3.8 billion euros compared to 2018, that generated by irregular work by 1, 2 billion, while the other components recorded a reduction of 0.5 billion. On the other hand, the illegal economy recorded an increase, albeit very limited, compared to the previous year (+174 million). Overall, the sectors where the weight of the hidden economy is heavier are Other personal services (35.5% of total value-added), Trade, Transportation, Accommodation and food service activities (21.9%) and Construction (20.6%). Here the note by Istat. 

Eurostat:  production in construction down by 1.3% in the euro area and 1.8% in the EU 

In August, compared to July, seasonally adjusted production in the construction sector decreased by 1.3% in the euro area and by 1.8% in the EU, according to first estimates from Eurostat, the Statistical Office of the European Union. In July, production in the construction sector increased by 0.1% in both the euro area and the EU, but compared to August 2020, it decreased by 1.6% in the euro area and 1% in the EU. Regarding the sectors, the monthly comparison shows that, in the euro area, civil engineering decreased by 1.9% and building construction by 1.3%. In the EU, building construction fell by 2.1% and civil engineering by 1.4%. Here the Eurostat website section dedicated to press releases. 

Istat: Real estate market up by 4.9% in the fourth quarter of 2020  

In the fourth quarter of 2020, notary agreements regarding sales of real estate units and any other kind of exchange of properties and appurtenances in return for payment were 245,240. Real estate unit exchange agreements rose by 3.2% compared to the previous quarter and by 4.9% on an annual basis. According to Istat, after the sharp decline caused by the pandemic in the first six months of the year and the growth in the third quarter, the seasonally adjusted index of sales continues to increase in the fourth quarter, exceeding the average values of 2010 in all the geographical areas of the country. Here the note by Istat. 

INPS: 121.8 million hours of Cig (Wage Guarantee Fund) in September, down by 41.6% in a month 

In September, 121.8 million hours of CIG and solidarity funds were authorized. 95% of the hours of CIGO (Ordinary Wages guarantee fund), CID (Derogatory Wages Guarantee Fund) and solidarity funds were authorized due to the "COVID-19 health emergency". According to Inps, applications decreased by 41.6% compared to August and 51.2% compared to September 2020. From 1 April 2020 to 30 September 2021, 6.38 billion hours of CIG were authorized due to the health emergency: 2,687.6 million of CIGO, 2,276.8 million of solidarity funds 1,416.2 million of CID. Here the Inps website section dedicated to press releases. 

Istat: Industrial turnover up by 0.8% in August 

In August, the seasonally adjusted industrial turnover index increased by 0.8% on a monthly basis both on the domestic and non-domestic markets. Year on year, the index grew by 13.8% (+ 13% on the domestic market and + 15.2% on the non-domestic market). Istat specifies that, in the quarter June-August, the index grew by 4.5% compared to the previous three months (+ 3.9% on the domestic market and + 6% on the non-domestic one). In particular, Istat estimates a month-on-month increase in intermediate goods (+ 2.4%) and for consumer goods (+ 0.4%), while records a reduction in energy (-2.5% ) and capital goods (-0.3%). Here the note by Istat. 

The survey "Gli Italiani e il Risparmio (Italians and Savings)" by Acri-Ipsos 

In the annual survey on "Italians and Savings", Acri and Ipsos estimate that 45% of Italians have accumulated savings in the last 12 months with great confidence in the future. However, the number of households that used their resources or requested a loan increased to 19% in 2021 compared to 16% in 2020, describing "a less favourable situation that led to associate saving to sacrifice ". According to the report, most interviewees (54%) think that the end of the Covid emergency is getting closer and the interest in different forms of investment begins to grow slowly and progressively (37% vs 35% in 2020), as well as the propensity for riskier investments, which reached 14% from 9% a year ago. However, 60% of Italians continue to prefer liquidity. Finally, confidence in the European Union has increased, reaching the highest level in the last 10 years and strengthening the belief that everything will go in the right direction in the near future. Here to learn more. 

INPS: employment contracts on the rise in 2021, + 20% in the first seven months

In the first seven months of 2021, 4,095,062 new jobs were activated, while 2,958,696 were terminated. INPS observatory on precarious work revealed these results underscoring that the balance is positive by 1,136,366 contracts, mainly fixed-term, temporary and seasonal contracts. On the other hand, the balance of permanent contracts was positive by only 124 thousand units (including transformations) between January and July. In the first seven months of 2021, transformations of fixed-term contracts amounted to 261,000, with a decrease of 16% compared to the same period in 2020; However, starting from the second quarter of 2021, there were positive changes (in July equal to + 15%). Here the INPS website section dedicated to press releases. 

 

The voice of Stakeholders 

Coldiretti: "Made in Italy" wine turnover hits a historic high 

The progress of the anti-Covid vaccination campaign with the reopening of all catering activities around the world projected the turnover of Made in Italy wine to record levels with a value of over 12 billion in 2021, even surpassing the pre-Covid results. This is what emerges from Coldiretti's analysis of Istat data presented during the first Vinitaly Special Edition. The increasing turnover of wine is driven by exports worldwide, which grew by 15%, but also by households' purchases increased by 9.7% in the first nine months of 2021. Here to learn more. 

Unioncamere-Symbola Foundation: in the last 5 years, 441 thousand Italian companies have invested in the green economy and sustainability to face the future 

Over 441 thousand companies have decided to invest in green technologies and products in the period 2016-2020. Despite the pandemic crisis, 31.9% of companies in industry and services have invested in green technologies and products, increasing to 36.3% in manufacturing. This is what emerges from the twelfth “GreenItaly” report, realised by the Symbola Foundation and Unioncamere. According to the report, these companies show more dynamism on foreign markets than the rest of the Italian production system, innovate more and produce more jobs. Regarding manufacturing companies (5-499 employees), the share of exporters among eco-investing companies is equal to 31% in 2021, and 20% those who have not invested. Also, 14% of green investing companies expect an increase in turnover for 2021, against 9% of the others. Here to learn more. 

 

Innovation 

 

€ 300 million for SMEs, MISE refinances the “Nuova Sabatini” 

The "Nuova Sabatini", the measure of the Ministry of Economic Development aiming to support the productive investments of small and medium-sized enterprises for the purchase of capital goods, was refinanced with additional 300 million euros. The choice aims to give continuity to the measure to give financial support to SMEs investing in tangible (machinery, plants, business capital goods, new factory equipment and hardware) and intangible assets (software and technologies). The measure will be refinanced with 300 million approved by the 2021 Budget Adjustment Law, in addition to the 425 million euros provided by the Sostegni-bis Decree. Here the note by MISE. 

E-commerce, Italians discover "phygital" and jump to the top of the European ranking

According to the Salesforce Shopping Index ranking, Italy is first in Europe and fourth in the world for e-commerce growth in the first quarter of 2021.Three out of four Italians (74%) have made purchases using "phygital" methods in the last year. In particular, the most popular products recording at least one purchase were clothing (28%), electronics (24%) and beauty products (21%). As for physical stores, supermarkets and clothing stores are the categories where “phygital” methods are most frequently adopted. Overall, 30% of Italians consider the “phygital” shopping experience very satisfactory. Here for further information. 

Manufacturing 4.0, a hybrid cloud star, investments will double in 3 years 

According to the third edition of the annual Enterprise Cloud Index report by Nutanix, a hybrid cloud will be the lever for IT modernization in manufacturing. 62% of firms are adopting it to meet business requirements better, 60% to control IT resources, and 53% to meet business needs more quickly. 87% of professionals believe that hybrid cloud infrastructure is the best IT system for their company. The analysis forecasts that within 3 years, manufacturing companies will double the use of the hybrid cloud and increase its implementation reaching a share ofmabout 52% in the market within the next 5 years. Here to learn more. 

Censis-Lenovo: digital life simplifies life, but 13.2 million Italians have connection problems 

70.4% of Italians believe that digitization has improved their quality of life simplifying many daily activities, and 90% are satisfied with the devices they own. These results are provided by the research «La digital life degli italiani (The digital life of Italians) » carried out by Censis in collaboration with Lenovo. In post-pandemic Italy, 74.4% of users consider the combined use of a plurality of devices (smartphones, PCs, laptops, tablets, smart TVs, game consoles) quite usual. Here for further information. 

Gender equity 

 

A step forward for the new Code of equal opportunities 

On 23 June, the Labour Committee of the Chamber approved unanimously the bill aiming to bridge the gender pay gap between women and men. The draft law, now being examined by the Senate, aims to promote gender equality between the sexes and support the participation of women in the labour market. However, it suggests that businesses need a long time to consider gender equality an advantage and not a cost. Here for further information. 

Digital technology boosts female entrepreneurship

Women become protagonists of the country's Digital Transformation. The share of female businesses in the Data Analyst and E-Commerce sectors, which drive the digital transformation, is clearly above the general average. They amount to 22% of all Italian enterprises registered in the Business Register and 17.2% of companies (i.e., excluding sole proprietorships). These results emerge from the study "Dal soffitto al Diaframma di vetro – Imprese e carriere al femminile", carried out by the University of Padua, InfoCamere, Observatory for Digital Professions and Hybrid Works. According to the research, the territorial distribution is almost uneven and holds some surprises. The highest female share is in the Southern Regions (27.4% in Molise, 26.4% in Basilicata, 25% in Abruzzo, 24.4% in Sicily) and the Centre (24.8% in Umbria ), while some regions such as Lombardy (18.9%), Emilia-Romagna (20.8%), Veneto (18.9%) and Trentino-Alto Adige (18.1%) are below the national average. Here to learn more. 

Local Authorities 

 

Waste, from MiTe 2.6 billion investments    

The Ministry of Ecological Transition will invest 2.6 billion euros for the construction of new waste management plants, the modernisation of existing ones, and for the development of circular economy projects. The funds include one and a half billion euros for municipalities and local authorities to realise new waste management plants and modernise the existing ones. Other 600 million are for flagship circular economy projects to strengthen and implement strategic industrial supply chains and provide for the scarcity of raw materials, 65% of which are consumed in cities. The measures aim to develop the circular economy according to the European action plan to reach the European recycling targets and contribute to achieving decarbonisation objectives by 50%. Here to learn more. 

Centro Studi Enti Locali: only 3.5% of municipalities collaborate to combat tax evasion 

Only 3.5% of Italian municipalities (280 out of a total of 7904) supported the financial administration in 2020, transmitting helpful information to the Revenue Agency to identify evasive and/or elusive behaviours. The successful reports brought a treasury of about 6.5 million euros to 280 entities involved. This considerable revenue has been subject to constant erosion and has halved compared to 5 years ago when it was equal to 13.3 million. A Report realized by Centro Studi Enti Locali, based on data released by the Interior Ministry and the Ministry of Economy and Finance, revealed these data. Here to learn more. 

The Council of Ministers approved the draft budgetary plan

The Council of Ministers approved the “Draft Budgetary Plan for 2022”, outlining the measures that will be defined in the budget bill and the effects on the main macroeconomic and public finance indicators. The document estimates the measures included in the budget bill to support the economy at the end of the pandemic, strengthen the growth rate in the medium term, and reduce the tax burden on households and businesses. In particular, the plan increased the Fund for Local Public Transport and allocated additional resources for local authorities. Here for further information. 

The world of MEF 

 

MEF: Liquidity implementation task force, the requests submitted to the Guarantee Fund for SMEs exceeded 202.5 billion

Moratoriums still active (pursuant to law and voluntary) amount to approximately 64 billion, against about 570,000 suspensions granted. Requests for guarantees on new bank loans for micro, small and medium-sized enterprises submitted to the Guarantee Fund for SMEs exceeded 202.5 billion. The loans guaranteed through the “Garanzia Italia” fund of Sace amount to € 29.1 bn, out of 3,364 requests received. These are the main results of the survey carried out by the task force set up to promote the implementation of the measures to support liquidity adopted by the Government during the Covid-19 emergency. The task force includes the Ministry of Economy and Finance, the Ministry of Economic Development, the Bank of Italy, the Italian Banking Association, Mediocredito Centrale and Sace. Here the press release by MEF. 

MEF: historic agreement on international digital services providing for a more equitable system 

MEF announced the global minimum tax agreement to ensure that large companies pay a minimum rate of 15%. 136 of the 140 OECD member countries signed the agreement, including the EU and the G20 countries. The new multilateral tax regime allows the termination of commercial measures adopted in response to taxes on digital services. Only Kenya, Nigeria, Pakistan and Sri Lanka remain out of the agreement. The new taxation will take effect in 2023 and will establish a fairer, more stable tax system that can better meet the needs of the 21st-century global economy. Here the Press Release by Mef.