Carlo Ferro took on the presidency of the Board of Directors of the ICE Agency in January 2019 and, just a year later, he found himself having to face the pandemic and its heavy repercussions. He had probably envisaged the professional and human trajectory at the helm of the Agency for the promotion of Italian companies abroad and their internationalization as being less demanding, but it was precisely the adversities of fate, which gave him the strength to move forward with even greater drive. After all, the years spent as president of STMicroelectronics and those in the role of vice president of Assolombarda with responsibility for industrial policies and taxation were an excellent ‘training ground’ to face the prestigious challenge of Ice.
President Ferro, the war on the pandemic is not over yet but some battles have been won. How do you see the coming months from the exclusive vantage point of the ICE Agency?
The vaccination plan is progressing rapidly in Italy and in the main countries involved in global trade. On this basis we are optimistic. According to the ICE-Prometeia Report that we have recently presented, in 2021 international trade will make new gains of 7.6% in volume and the recovery will be consolidated in 2022 with a further growth of 5.3%, bringing the imports of the markets analyzed back to pre-crisis levels towards the end of this year.
There are signs of recovery across Europe. Industry data in Germany and Switzerland shows a surge. Will the long wave also involve Italy?
Our country’s exports have already begun to recover and the data provides encouraging signs. In comparison with other countries, we note that the contribution which exports make to GDP, compared to other components, was less unfavorable in Italy than in other countries. Among those in the G8, Italy has the second smallest decline in exports and has also performed much better than France, the United Kingdom and the United States. 2021 began with a positive sign in January. I am also confident that with the NRP, public investments, private investments and, gradually, internal consumption will soon recover. We see the glass half-full: in the negative average figure of 2020 there are many sector excellences that recorded positive performances, often in double digits, in certain markets an indication of the ability of our supply chains to withstand unexpected shocks.
How much has Made in Italy suffered due to Covid?
The pandemic had an asynchronous effect on demand across sectors. Consequently, Made in Italy suffered a double-digit global decline in exports for some sectors of particular importance for our country such as mechanical engineering, the fashion system and furniture. Other sectors performed better: agro-food and chemical-pharmaceutical, for example, even recorded a growth in exports. But let me add that in the face of the critical moments (in the sense of ‘moments of transition’) of recent history, it is precisely through internationalization that Italy has shown some of its best ideas: from the introduction of the euro, to the entry of China in the WTO, to the 2008 financial crisis. For example, Italians were able to shift the competitive advantages, which were previously attributable to the easy discounts of devaluations, to quality and customer service, look to China as a consumer market, as well, and bet on an increase in its international vocation in the face of the difficulties of the domestic market. Thus, exports have come to represent about 1/3 of the national GDP and today they represent a pillar on which to build the response to a new, equally complex challenge of recovery and repositioning on new competitive paradigms.
The mechanical engineering industry represents a very high share of our exports, yet this sector will need the support of the government to accelerate after a year of being (almost) at a standstill.
The system has moved into action and it has done it so quickly in order to give maximum support to our companies, for mechanical engineering, for the entire industrial and artisan fabric of the country that looks to foreign markets. The Export Pact is a major intervention plan wanted by the Minister of Foreign Affairs and agreed upon with all the players in the system through an intense process of listening to the needs of businesses, particularly SMEs. It is a great system action that puts businesses at the center and calls all the implementing bodies – such as ICE – to do new things (for ICE these are 14 new initiatives) and to do them faster and better. Mechanical engineering (machinery and appliances) is our main export sector and the leading contributor to the surplus of the country’s trade balance. Agricultural machinery is a component of excellence and we are aware of the urgency, even more so today, of promoting its contribution to the growth, sustainability and performance of the agricultural supply chain in many countries.
You come from a prestigious experience in STMicroelectronics: in your opinion, which sector of our industry will be the most ‘reactive’?
On a global level, the ICE Prometeia Report shows how new issues will strengthen that will affect foreign trade in both consumer and investment goods. In the former, a return to essentials and healthy aspects will favor food and furniture in Made in Italy (+8.5% and +8.4% growth respectively in 2021) but also a recovery, compared to the decline of 2020, for the fashion system, more linked to social relations (+6.7% the expected change in 2021). Among the sectors connected to transport, after the sharp drop of 2020, there will be a faster recovery in demand in the automotive sector. Regarding investment goods, there will nevertheless be a growth in mechanical engineering, the leading national export sector (+6.8% the forecast for 2021 and a growth rate of just over 5% in 2022), and in electronics (+8.2%), a sector which has already proven itself to be one of the most resilient during the most acute phase of the crisis. And speaking of electronics, since you mentioned my background, I remain convinced that the digital transition will be pervasive in the development of demand, for consumer sectors across the board, and will characterize innovation in the value chains of capital goods.
How much will the NRP affect the recovery of Made in Italy?
A lot. The National Recovery and Resilience Plan is a unique opportunity to build the transversal skills oriented to the digital transition and ecological transition required as critical success factors, even in global markets, for all sectors of Made in Italy. In the end, the products exported are such that their innovation and competitiveness will find renewed advantages in the framework of measures and reforms envisaged by the NRP.
Do SMEs remain the backbone of our economy?
Yes, absolutely! And it is precisely for this reason that they must be protected and helped to grow in the markets. The ICE Agency has launched a plan of 14 new initiatives, 14 things that it did not do two years ago, in the guidelines of the Export Pact. Among these, some concern accompanying SMEs on the path towards digital modernization, others facilitate their presence in the world and lastly there are others, which concern the usability of services for SMEs. I shall mention a few. In the first category (digital): 29 virtual showcases of Made in Italy organized and sponsored by ICE on B2C and B2B marketplaces to offer at least 7000 SMEs the opportunity to sell online; the Smart-Export academy, with the Ministry of Foreign Affairs and International Communication, online for 2,000 companies; and the development of services on blockchain technology for product traceability and therefore brand protection. In the second category (internationalization): the Fiera Smart (Smart Fair) 365 platform for remote missions and B2B; the free entry to the first ICE group participation form in foreign trade fairs in 2021; and the new madeinitaly.gov.it. portal. And in the third (usability): the territorial DeSKs; free services for companies with up to 100 employees; and the new unified country system portal export.gov.it. All initiatives focusing on SMEs. I am pleased that many entrepreneurs recognize that in two years we have made the “Copernican revolution” in ICE, of putting SMEs at the center of our action.
What, in your opinion, are the ‘new frontiers’ to be attacked with our products?
Digital, innovation and sustainability. Three keywords, three paradigms that will characterize the markets of the future, which will guide industrial policies, production and consumption models in the post-Covid era. The Country System and the ICE Agency, coordinated by the Ministry of Foreign Affairs and International Communication are at the side of companies to support them in their recovery in this “new normal”. The NRP, as we have said, is the historic opportunity to realign the country’s skills and infrastructures at the service of growth.
President Ferro, why should a foreign industry come to invest in Italy?
Because competition in world markets is already shifting from cost factors to quality and innovation skills. In Italy, culture, Leonardo’s 500-year tradition of creativity, craftsmanship and smart and sustainable new technologies converge in a unique blend of ancient knowledge (the beautiful and well-made of the “3F”) and new skills. Think about what you have done as entrepreneurs in recent years with the Industry 4.0 technologies associated with the tradition of the mechanical engineering industry. Among the strengths of our industry, in addition to the excellent quality of the product, there is the recognized ability to adapt it to the needs of the customer in different markets: the ability to customize complex machinery and technologies. Then there is another aspect: Italian lifestyle and consumption are coveted in the world. These two years I have spent working in the service role that I carry out with ICE have given me the opportunity to experience all these aspects firsthand. Visiting more than 20 countries (then the pandemic stopped me, but I’m starting again!) I understood how much Made in Italy is appreciated and how much Italians enjoy great popularity abroad, all over the world. In the parterre of the fairs and in the factories I saw the incredible ability and tenacity of the entrepreneurs, across all sectors, from the North to the South of the country.
How do you imagine our future and that of our children?
A new Renaissance where culture and technology unite for the sustainable growth of a country, a respected part of a great Europe, where new generations find the opportunities that unfortunately not all today’s young people have within easy reach.