FOREIGN INVESTMENTS IN THE TIME OF THE PANDEMIC: ITALY RETURNS ITS APPEAL

FOREIGN INVESTMENTS IN THE TIME OF THE PANDEMIC: ITALY RETURNS ITS APPEAL
FOREIGN INVESTMENTS IN THE TIME OF THE PANDEMIC: ITALY RETURNS ITS APPEAL

FRANCE is the most attractive country for foreign investors in Europe. For the second consecutive year it is at the top of the ‘Europe Attractiveness’ ranking drawn up by EY for 2020, in which Italy places twelfth, after Russia. In the leading trio there are, as usual, the United Kingdom (relegated to second place after the Brexit referendum) and Germany. Spain follows in fourth place and then Belgium, Poland, Turkey, Holland, Ireland, Portugal and Russia. Italy has always been out of the Top Ten, but they can console themselves for not losing positions or even big deals last year. All the major European economies, in fact, have suffered from the pandemic crisis and have lost many foreign investments compared to 2019, but Italy has not, on the contrary, it has scored a remarkable + 5%, against the -27% of Spain, – 18% of …

FRANCE is the most attractive country for foreign investors in Europe. For the second consecutive year it is at the top of the ‘Europe Attractiveness’ ranking drawn up by EY for 2020, in which Italy places twelfth, after Russia. In the leading trio there are, as usual, the United Kingdom (relegated to second place after the referendum on Brexit) and Germany. Spain follows in fourth place and then Belgium, Poland, Turkey, Holland, Ireland, Portugal and Russia. Italy has always been out of the Top Ten, but they can console themselves for not losing positions or even big deals last year. All the major European economies, in fact, have suffered from the pandemic crisis and have lost many foreign investments compared to 2019, but Italy has not, on the contrary, it has scored a remarkable + 5%, against the -27% of Spain, – 18% of France, -12% of the United Kingdom and -4% of Germany (thanks to the relative success in fighting the pandemic, the German decline was less precipitous). At the continental level, the average decline was 13%.

Investment projects in the Old Continent last year dropped to 5,578 from 6,412 in 2019, moving even further away from the record of 6,653 set in 2017. This is the first double-digit decline since 2009, when the global financial crisis caused a decline in ‘11%. However, the report notes, investments have backed up, but have not been decimated during the unprecedented emergency caused by Covid-19. Especially since some sectors have moved against the trend and have had an excellent year in terms of foreign investments. Against the backdrop of the pandemic, life sciences recorded growth of 62% with 265 projects and logistics of 11% at 595 projects. The IT software and services sector remained among the most attractive with 1,046 foreign investment projects, but with a decline of 14%, felt above all in Great Britain (-30%) and France (-29%), while Germany scored growth of 13%. Manufacturing plants suffered a 22% drop in projects, from 1,684 to 1,320. The country that benefited most from foreign investments, as mentioned, was France with 985 projects, followed by Great Britain with 975 and Germany with 930. The other European economies are far from these numbers: Spain has collected 354 projects. investment and all other countries are below 300, with Italy at 113.

Although marked by volatility, investments in Europe – notes the report – have proved relatively resilient because the Old Continent is perceived as a stable context, with the fundamentals that investors need, that is, an abundant supply of skilled labor , robust infrastructure, political stability and a large market. But Europe certainly cannot be satisfied and must act quickly if it is to remain a favorite destination for foreign investment in the long term. Covid has access to the spotlight on some particularly crucial factors when it comes to deciding where to invest. First of all, skills, after Covid triggered a strong demand for technology and automation and therefore for digital skills. 82% of companies surveyed in the report indicate that the availability of a workforce with technology skills is an important factor in choosing where to invest and 75% believe that the 5G network is also essential.

Among the elements taken into consideration, sustainability is also becoming increasingly important: 9 out of 10 companies consider it important for their investment decisions and 85% already consider Europe as a ‘green leader’, but it is a role that it must be consolidated over time. The stimulus policies introduced to combat the pandemic, in particular those put on the plate by the EU, are also attracting investments, as well as the prospects for a profound transformation of economies and societies. Another crucial point is simplification, that is, regulatory stability, transparency and harmonization. And on these points Italy falls, where regulatory stability and transparency are very lacking.

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