SPECIAL ISSUE: P IEMONTE’S INTERNATIONALISATION PLAN

THE REGION OF OPPORTUNITY

As one of Italy’s largest and most densely populated regions, Piemonte has a rich legacy of history and tradition, but it has always looked to the future, seeking out innovation and challenges.

In the latter years of the nineteenth century Piemonte was the cradle for the events, now known as the Risorgimento, which led to the unification of Italy.

This vibrant political scene was also matched by a tradition for work and enterprise: Piemonte has always been at the forefront of the Italian economy and a driver of its industrial development; its sectors of excellence

range from the automotive industry and its ancillary chain - it was here that Fiat was born in the early 20th century - to highly specialised manufacturing, ICT (Information & Communication Technology), and major centres of research and development, not to mention education and training.

In addition to these solid economic and industrial foundations, Piemonte offers a number of other outstanding features: the unique beauty and variety of its landscapes, an unparalleled range of year-round tourist activities, a millenary history that is evident at every turn, the monumental Savoy architecture, and a wealth of fine wines and foods renowned worldwide.

In short, Piemonte is a region that offers fantastic opportunities.

THE REGION OF OPPORTUNITY THE ECONOMY IN PIEMONTE: AN OVERVIEW

OPPORTUNITY TO BE LIVED FOCUS ON PIEMONTE’S INTERNATIONALISATION PLAN

THE OPPORTUNITY TO GROW AND INVEST EXPORTS: A POSITIVE TREND

OPPORTUNITY TO BE LIVED

The countryside and the environmentPiemonte has everything: the Po, Italy’s longest river, rises below the summit of Monviso and starts its long journey through the Po Valley; the scenic hills of the Langhe and Monferrato offer a landscape of incomparable charm; Europe’s highest mountains attract visitors in both Summer and Winter, as do Lago Maggiore and Lago d’Orta, lakes of extraordinary beauty.

This is a region with 210,000 hectares of natural parks and protected areas, encompassing the Gran Paradiso National Park and that of Val Grande, the regional nature reserves and the Sacri Monti, which are now Unesco world heritage sites, like the Royal Residences (among others, the Reggia of Venaria Reale, the Royal Palace and Palazzo Madama in Torino, Stupinigi Hunting Lodge, Racconigi Castle), splendid examples of Baroque art now attracting millions of tourists from all over the world.

Education and vocational trainingPiemonte is rightly proud of its network of educational establishments, which is already one of the best in the country and constantly expanding. The plans drawn up by the education boards and the Regional Department of Education detail the continuous improvements being made to the educational system, at a time when pupil numbers are rising and the school-aged population is becoming more diversified owing to the presence of foreigners and immigrants, thereby reinforcing the importance of social integration.Piemonte offers its young school-leavers a choice of four excellent universities: the University of Torino, the Politecnico of Torino, the University of Eastern Piemonte, and the University of Gastronomical Sciences at Pollenzo. But there are also institutes for further education, technical schools and vocational training courses. This diversified panorama offers an excellent point of

between north-western Europe and the Mediterranean area, as well as one of the main access routes to the Alps. These natural advantages have made the region a thoroughfare for trade, people and knowledge from all over Europe: it is thanks to this and to a history of entrepreneurial excellence that Piemonte is now home to world-class industries.The most dynamic sectors are the metalworking and chemical industries, textiles, food, technology, manufacturing and industrial design. It is a panorama that combines traditional sectors - like the automotive and clothing industries - with newer businesses linked to technological innovations, telecommunications, renewable energy and life sciences.The past, present and future combine to create a system that preserves Piemonte’s role as the driving force behind Italy’s national economy.The business community has been prompt to rise to the new challenges posed by the global market, in particular through the burgeoning number of small and medium enterprises, often aggregated within a network of industrial districts, which form a system that combines the potential of large-scale production with the flexibility typical of SMEs.Piemonte’s economic and manufacturing scenario has also benefited from a strong drive towards globalisation, which is at one and the same time both a consolidated reality and a goal for the future: the region has the third highest level of inward investment in Italy, as well as ranking fourth for exports. It is a trend that is destined to grow thanks to the activity of CEI, the Agency for Investments, Export and Tourism, the first body of its kind in Italy.

THE ECONOMY IN PIEMONTE: AN OVERVIEW

General FrameworkThe economic landscape of Italy and Piemonte in particular is determined by factors such as globalisation, free trade and the emergence of new competitors, along with the increasing volatility affecting the financial market and raw material prices. Major changes such as the shift in consumption models - i.e. more segmented and polarised

entry to the world of work. Another aspect of Piemonte’s training facilities worthy of note are the institutes linked to the United Nations. Torino boasts no fewer than three important centres, which are attended by future diplomats, ambassadors, international mediators and other high-ranking figures in international relations: ITC ILO, the International Training Centre of the International Labour Organisation; UNICRI, the United Nations Interregional Crime and Justice Research Institute, and UNSSC, the United Nations System Staff College.

Transport and healthThe Region offers its inhabitants a range of first-rate services. The infrastructure and transport network comprises 900 kilometres of motorways, 2,700 kilometres of regional and inter-regional roads, and 2 thousand kilometres of railways linking Piemonte to major Italian and European networks. There are also five airports, including two international hubs at Torino Caselle and Cuneo Levaldigi, and an extensive public transport system.A chapter apart is reserved for health, a sector of strategic importance in terms of the quality of life in any area. The efficiency and performance levels of Piemonte’s medical institutions are among the best in Italy, confirmed by both the rankings drawn up by Italy’s central government and by satisfaction ratings compiled from surveys of the region’s inhabitants.

THE OPPORTUNITY TO GROW AND INVEST

The negative effects of the economic downturn and international recession are partly offset by data on Piemonte’s economic role in Italy: Piemonte maintained its share of national GDP (8.7% of Italy’s total) and ranked fourth in the classification of Italy’s exporting regions, accounting for 10% of total national exports.

A region of industrial excellenceIts unique geographical position makes Piemonte a crossroads, a “gateway”

demand - also connected with the rise of new interaction models in the Web 2.0, as well as factors such as a contraction in domestic demand, climate change and the need to ensure that natural resources are used sustainably also affect the economy of the region. In this context, the crisis is a trend accelerator that highlights weaknesses and acts as a major driver of change. Piedmont is one of the regions that have been hardest hit by recession, as its economy is more exposed to volatile demand.

Future ProspectsFortunately, clear opportunities and strengths are emerging for Piemonte to bet on. Signs of a revival are noticeable, even if they are overshadowed by the slowdown and the hard times that economic adjustments are imposing on businesses and the public alike. A desirable revival can be referred to as a sort of metamorphosis, a deep shift towards a stronger, more balanced socio-economic structure. Within this framework, the concept of smart specialisation strategy has been developed at national and regional level. The strategy envisages the definition of innovation policies aimed at boosting the most promising specialisations for the region and for local businesses, also based on the available resources and capabilities. Resources and future interventions are to be allocated with a view to stimulating growth through the implementation of appropriate strategies that promote industry, this being the main focus of regional policies. The recovery of industrial activities, with particular reference to the manufacturing sector, will be at the heart of economic policies and development planning - in line with the EU targets of making the manufacturing industry a bigger contributor to GDP. The aim is, on one hand, to launch investments that stop the steady loss in productivity and jobs and, on the other, to promote R&D, increase innovation and achieve greater market access, in order to regain competitive edge. Another objective is to help SMEs to enter the international market, to facilitate networking and cooperation, to strengthen their capital and to promote access to credit. The new European strategies aim at boosting strong sustainable growth. An array of opportunities are offered by

the green economy, in particular the Clean Economy supply chain. Regional policies are intended to foster end-use energy efficiency, smart grid development and, at the same time, to support bioenergy production, also making the most of the region’s rich forestry heritage. Innovation policies for industrial sustainability also offer opportunities to export know-how and for new product commercialisation. Furthermore, it is essential to invest in the active management of the natural, landscape and rural heritage in order to protect and develop business models that are based on promotion of the territory, which have proved successful despite the current crisis.

The plan for competitivenessIn spite of the international crisis, Piemonte retains its role as a driving force behind the Italian economy, as well as its reputation as one of the most active and innovative regions in Europe. It continues to offer opportunities for development and investment. The title chosen by the regional administration for the new 2010-2015 Competitiveness Plan, “Piemonte offers opportunity”, reflects these concepts. The plan foresees the allocation of Euro 500 million to three main areas of intervention: business competitiveness, finance and new businesses, and research, university and innovation. Over all, it highlights the development lines for the coming years and focuses on far-reaching programmes.

An international vocationPiemonte’s international vocation is a tradition, favoured by its geographical position and by well-established industrial and economic relations, but it is also an objective for the future: strengthening the region’s international competitiveness is vital to its definitive economic revival. Incoming and outgoing capital, big names that sell abroad (such as Fiat, Azimut, Zegna and Pininfarina, to name just a few), multinationals that invest in research and development in the region (Microsoft, Vodafone, General Motors and many others), but also services, individuals and expertise: the internationalisation strategies put in place by the Regional government involve numerous sectors, in order to respond successfully to the challenges of the future.

THE PLAN PUT IN PLACE BY REGIONE PIEMONTE AND THE CHAMBERS OF COMMERCE HELPS SMALL ENTERPRISES TO INTERNATIONALISE, WITH SUPPLY CHAIN PROJECTS THAT GIVE EXCELLENT RESULTS: EVERY EURO INVESTED HAS GENERATED EURO 22 EURO OF ORDERS

Sometimes it is a need, often a conscious choice and in many cases a vocation.The attention the Piedmontese companies dedicated to foreign markets is the fruit of a clear strategy, confirmed by the efforts made by Regional Piemonte to boost internationalisation, together with Unioncamere Piemonte and the Piedmontese Chambers of Commerce, through the activities of Ceipiemonte (the Agency for Investments, Export

PIFs and PIMs follow in the footsteps of projects that have preceded them, with extremely satisfactory results.In October 2013, the 16 PIFs drew together 1,525 Piedmontese companies, 171 of which registered with the Integrated supply chain project for Agro-food, 167 with Automotive, 154 with Design, building, and inhabiting, 124 with Creative industries, 117 with Automation, systems and mechatronics, and 114 with Aeronautics, space and defence. On the other hand, there were fewer than 100 registrations for each of the other Integrated supply chain projects; however, we should mention the significant number of applications for ICT (94 companies registered), Textiles and textile machinery (92 registrations) and Energy and the environment (82 companies registered).If we consider the geographical distribution of the companies, the provinces of Torino and Cuneo submitted the highest number of registrations in PIFs (particularly for Automotive and Agro-food, which are respectively the specialist fields of the two provinces), consistent with their propensity for exports, which is stronger than in other parts of the region.

In October a total of 2,355 Piedmontese companies were registered with the 14 Integrated market projects.

The PIMs that received the highest number of applications are those for the markets of central-eastern Europe (267 companies), Russia (231 companies) and Brazil (216). There were also a significant number of registrations for the PIMs of North Africa and the Middle East (189 companies), the Persian Gulf (182 companies), the Balkans (168), China, South Korea and Japan, Turkey (163 each) and India (161).

Like the Integrated supply chain projects, the highest number of applications to PIMs came from companies in the provinces of Torino and Cuneo.

But the most outstanding element is the fact that for every Euro invested has generated on average a value of Euro 22 of orders and Euro 17.8 in terms of potentially concluded negotiations.

and Tourism), the first regional organisation dedicated to this issue, set up in 2006 by a regional law that drew together the existing entities, and operational from the following year.

The activities undertaken in support of the entrepreneurial system are not limited to assisting exporting companies (1,250 consultancy contracts were honoured in 2012, primarily regarding legal, tax and customs issues, over 4,300 meetings were organised, and 43 fair exhibits were coordinated), but address the need for a change in mentality, and encourage companies to work together and to form alliances in order to make competitive proposals for innovative projects.

For example, a company that produces brake pads has more advantages if it allies with others that manufacture brake discs or thrust springs.

The internationalisation plan implemented by the Piedmontese regional government and Chambers of Commerce is built around two important schemes: Integrated supply chain projects (PIF) and Integrated market projects (PIM). The former aim to structure and rationalise activities by addressing Piemonte’s most important manufacturing supply chains (such as the Automotive, Aerospace, ICT, Design and Agro-food industries). The latter group companies together around a common geographic goal of “conquest”, to expand the markets.

FOCUS ON PIEMONTE’SINTERNATIONALISATION

PLAN

INTEGRATED SUPPLY CHAIN PROJECTS - PIF

INTEGRATED MARKET PROJECTS - PIM

Each project obviously has its own specific characteristics. For every Euro invested, the aerospace project (Piemonte Aerospace) has generated 60 as an economic return, while the group of ICT companies has generated Euro 5.44 with orders for Euro 3.2 million. The historical “From concept to car” has gradually diversified activities: from the initial invitation to potential automotive buyers to tailor-made assistance to companies during negotiations. Here, every Euro is “transformed” into Euro 78 of orders. The principal negotiations address Russia, Turkey, Germany and China. We should also underline the “Tender” initiative which accompanies companies that compete in international public calls for bids: 8 successes by SMEs for a total value of Euro 1.6 million in emerging countries like Georgia, Malawi, Mauritius, Montenegro and Armenia.

However the returns are not just economic but can also be measured in terms of the cultural and competitive growth of companies that were able to compete internationally. In some cases it was thanks to these projects that small, less well-structured companies were able to cross the national frontiers.

Facts and figures of the Internationalisation Plan (2013)Business conventions: 8Missions: 30Workshops in Piemonte: 78Foreign operators involved: 1,135Countries of origin: 66

Integrated supply chain projects - PIFCompanies selected for PIFs: 1,486Fairs: 49B2B meetings: 11,681

Integrated market projects - PIMCandidate companies: 2,383Assistance to companies: 1,063Participants at Forums, Technical tables: 1000

Prospects for 2014In 2014 about thirty initiatives will be funded for a total value of Euro 7,200,000 euro (Euro 3,100,000 met by the regional government, Euro 3,100,000 by the Chambers of Commerce, and the remainder by the proposing companies): the supply chain projects regard aerospace, automotive, ICT, logistics, building, shipbuilding, publishing, design, jewellery, environmental technologies, biomedical, textiles, industrial automation, and agro-food; the market projects consider all the continents across a number of sectors.

Support activities are not limited to assisting companies that address foreign markets, but focus on the need for a change in mentality, encouraging them to work together and to form alliances in order to propose competitive offers for innovative projects. The returns are not just economic but can also be measured in terms of the cultural and competitive growth that comes from being able to compete internationally.

EXPORTS: A POSITIVE TRENDIn the first 9 months of 2013 the value of Piedmontese exports reached Euro 30.4 billion, increasing by 2.9% on the same period of 2012. The dynamics of regional exports bucks the national trend, which contracted by 0.3% on the period January-September 2012. If we consider the quarterly results separately, we can see that growth of 0.7% in the 1st quarter of 2013 was followed by more substantial growth in the 2nd and 3rd quarters of the year (+2.% and +5.8% respectively).Piemonte recorded the best performance among Italy’s leading exporting regions: Lombard exports were substantially stable (-0.1%), while Veneto and Emilia Romagna, the second and third exporting regions, both increased the value of their foreign sales by 2.0% on the period January-September 2012. In the 3rd quarter of 2013, the Piedmontese entrepreneurial system confirmed its slow but gradual recovery. The main indices improved by a number of points on the previous quarter and the best prospects come from exports, which confirm a moderately expansive trend even in the last part of the year (+6 points).

with overall growth of 3% on the value calculated for the 2012 report.

The overall increase was the result of the excellent dynamics of the social internationalisation index, which increased by about 8%, while the economic component remained substantially stable.

Where the social elements are concerned, on one hand we have the growing appeal of the Piedmontese higher educational establishments for foreign students (the percentage of foreign students rose from 6.9% to 8.0% of the total), and on the other the growing importance of foreign tourism to the region (from 2011 to 2012 the incidence of foreign tourists increased from 34.4% of the total to 41.3%).

From an economic perspective we must draw attention to the marginal contraction in Piedmonte’s propensity

Where the export markets for Piedmontese goods are concerned, the EU-28 market has attracted 57.5% of regional exports, compared to 42.5% for markets outside the European Union. Regarding the dynamics of Piedmontese sales, growth was positive for direct exports to non EU-28 partners (+8,9%), and negative for those to the EU-28 as a whole (-1.2%).

PIEMONTE’S CONCISE INTERNATIONALISATION INDEX

This year too, Piemonte’s internationalisation index, which summarises in a single index the trends recorded in 2012 by the various aspects of the phenomenon of internationalisation, grew positively,

Piedmontese exports in the first nine months of 2013

Exports: Euro 30.4 billion (+2.9% compared to January-September 2012)

Balance of trade surplus: Euro +10.2 billion

Exports to EU-28: -1.2%

Exports to non EU-28: +8.9%

for international trade (calculated as the sum of the imports and exports of goods and services compared to GDP), due essentially to the strong fall in imports of goods recorded in 2012. With regard to the capacity to attract foreign direct investment, in 2012 the situation was essentially unchanged from the previous year, whereas the presence of foreigners in the Piedmontese labour market is growing steadily.

Piemonte continues to appear more internationalised than the Italian average: taking the overall level of internationalisation in Italy to be 100, the Piedmontese average is more than 26 percentage points higher.

Regarding both the economic and the social aspects, Piemonte reveals a greater propensity to internationalisation that the country as a whole: the relative values are 124.9 and 141.2. If we consider the elementary indices in detail, the value for international training is particularly striking (the incidence of university registrations by foreign students at Piemonte’s four institutes of higher education is more than double the

national figure). Piemonte stands out above the national average for the higher percentage of foreign nationals among the resident population, due to an ability to attract more foreign direct investment, a greater propensity for international trade of goods and of services, and more intense participation of foreigners in the labour market.

The only area in which Piemonte lags behind Italy is international tourism: in 2012 foreign tourists to Italy accounted for 47.4% of total visitors, while the figure for Piemonte was 41.3%

100.0

119.1

127.3

132.3

148.0

157.7

175.7 181.1

20.0

40.0

60.0

80.0

100.0

120.0

140.0

160.0

180.0

200.0

2006 2007 2008 2009 2010 2011 2012 2013

Economic internationalisation index

Social internationalisation index

Overall index

0.0

50.0

100.0

150.0

200.0

250.0 Propensity for foreign trade

Attraction for FDI

Foreign workforce

Foreign population

International tourism

International training

THE DIAMOND OF INTERNATIONALISATION IN PIEMONTE

The construction of the index reflects two approaches: the first considers the internationalisation from a dynamic perspective, calculated in “points”, a methodology that makes it possible to trace the region’s international advancement or regression over the years. The second considers internationalisation from the perspective of territorial benchmarking, using the metod of index numbers, taking an average of 100 as the national value. This approach highlights Piemonte’s position in relation to the other Italian regions that it competes with.

Source: Unioncamere Piemonte

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