Global Attractiveness Index 2021, Italy improves the score, but is twentieth and loses two positions

Global Attractiveness Index 2021, Italy improves the score, but is twentieth and loses two positions
Global Attractiveness Index 2021, Italy improves the score, but is twentieth and loses two positions

Despite an unstable European context, Italy still manages to maintain a medium-high attractiveness among the 148 economies analyzed by the Global Attractiveness Index (GAI) 2021, showing a good balance between dynamism, sustainability and growth expectations.

The Global Attractiveness Index maps 148 economies of the world, with almost 1 million data points collected, and tries to understand how the “geography of attractiveness”As the speed of each country varies with respect to others, not only with respect to themselves. In this sense, the Global Attractiveness Index is a relative Index, as it subjects each economy to a comparison with “the best” (in 2021 the United States), referring to four macro-areas (openness, innovation, endowment and efficiency).

The 2021 edition – the results of which were presented during the Forum organized by The European House – Ambrosetti – focused more on the future. The research group responsible for the index, in fact, has decided on an even more interpretation focused on the medium to long term, through a new dimension of analysis relating to growth expectations.

The objective is reflected in the need to have a predictive and anticipatory dimension, to better evaluate the future prospects, in terms of attractiveness, of a country-system. In addition, the 2021 edition saw the introduction, within the Sustainability Index, of inequality indicators (income held by the richest 10% and gender inequality index) and progress towards the “green economy” (share of energy from renewable sources). The theme of sustainability sees Italy as a virtuous example on the European scene.

Global Attractiveness Index, data on Italy

As for theItaly, in an unstable European context, the country still manages to maintain amedium-high attractiveness, ranking in 20th place (against 18th place in the Global Attractiveness Index 2020).

Despite a ranking worsening, the score improved by approximately 1.8 points (61.32 in 2021 vs. 59.50 in 2020), which allows for recover “ground” compared to some similar European countries that precede it. In fact, in the period 2017-2021 Italy gained 3.93 points against Germany, 4.29 points against France and 15.65 points against the Netherlands.

In general, looking at the results of the five-year period, one can observe a overall improvement of Italy, which gains five places in the ranking of the Positioning Index of the Global Attractiveness Index of 2017 (25th place).

“The country boasts a series of excellent practices that make it a real best practice in Europe and in the world”, comments Ignacio Izquierdo Saugar, Chief Executive Officer of Aviva Italia Holding.

“It is important to underline that no country among those preceding Italy in terms of positioning shows one simultaneous condition of equilibrium, on medium and high levels, for dynamism, sustainability and growth expectations. Complementary indices to that of Positioning, which contribute to defining the general framework of attractiveness of a country ”, adds Roberto Monducci, Director of the Department for Statistical Production, Istat and member of the Scientific Committee who participated in the work on GAI.

The European context

L’Europe – while maintaining, on the whole, a high attractiveness – appears threatened by North America and Asia Pacific. Just think of the data relating to Foreign Direct Investments (FDI): between 2009 and 2019 the European percentage of FDI out of the global total decreased, passing from 40% to 24%.

“North America (from 13% to 20%) and the ASEAN area (from 3% to 12%) in particular benefited from this recomposition of the world scenario”, comments Valerio De Molli, Managing Partner & CEO of The European House –

Moreover, Europe has also been one of the areas most affected by the economic crisis triggered by Covid-19, with a double percentage contraction compared to the world average (- 6.5% vs. -3.2%).

However, if you look at the trend over the past 5 years, there is a process of increasing attractiveness. In fact, in the last five years, 20 out of 27 European countries have shown an improvement or maintained a stable position.

In this framework of prospective fragility of European attractiveness, the economic recovery and the enhancement of attractiveness will strictly depend on the structural interventions that can be implemented, in particular thanks to the program Next Generation EU.

This tool represents, in fact, aopportunity to relaunch, given the huge financial resources deployed and the ambitious reform programs aimed at increasing the resilience and competitiveness of European economies. In order to monitor the results of the Next Generation EU national plans, an ad hoc Dashboard was developed as part of the work of the Global Attractiveness Index 2021.

Forecasts for the future

Focusing on the short-term forecasts, some elements of attention immediately emerge that could influence the attractiveness of countries already in the next two years.

First, the logistical fragility of some globally extended supply chains and the consequent
rebalancing of the Global Value Chains. A second point of attention concerns the sightseeing, which represents a fundamental driver of growth for the economies of some countries – including Italy – and which recorded a loss of around 1.3 trillion dollars.

It will also be important to consider therising unemployment. In 2020, compared to the fourth quarter of 2019, around 8.8% of hours worked worldwide were lost. The significant loss of hours worked caused an 8.3% decrease in global earned income.

Finally, a fourth aspect concerns the growth of poverty and inequality social: with 97 million more people in poverty in 2020, inequalities and increasing gaps worldwide endanger the geopolitical and economic stability of several countries, making the international framework within which individual economies compete even more unstable .

The recovery will take place in a new scenario, in which companies will increasingly constrain their successes to a specific geographic area or to a particular country. In such prospect of reshoring, Italy’s task will be to seize this opportunity to attract and promote investments by Italian and foreign companies, supporting the sectors of
Made in Italy and the supply chains.

Finally, it will be important to “create a system”. “The pandemic has taught us that we cannot save ourselves and has given great value to the cohesion of communities, to their civic sense, to their culture. If the communities are strong, supportive, responsible, the attractiveness is even greater. We invest more ”, comments Ferruccio de Bortoli, member of the Scientific Committee and President of the Longanesi Publishing House and of the Vidas Association.

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