CICC-CONFINDUSTRIA China Roundtable, Beijing 29th July

31 July 2024

CICC-CONFINDUSTRIA: REBALANCING TRADE BALANCE AND FOSTERING INDUSTRIAL COLLABORATIONS

Cimmino: “Big gap to be filled for exports €2.4 bln for consumer goods and €2 bln for capital goods”

Riccardi: “Stock of Italian foreign direct investment in China amounts to more than €15 bln”

Beijing, July 29th, 2024 - A total of 115 Italian companies and business associations participated in the panel discussion “Italy investing in China: trends and perspective” organized in Beijing by the China-Italy Chamber of Commerce (CICC) and Confindustria as part of the 7th Italy-China Business Forum held during Premier Giorgia Meloni's visit.

The event, supported by the Embassy of Italy to the P.R.C., Italian Trade Agency (ITA), Cassa Depositi e Prestiti, SIMEST and SACE, delved into market dynamics to increase trade between Italy and China, and in particular to boost Italian exports, therefore rebalancing the trade gap, and fostering industrial collaborations.

The meeting was opened by a video message from the Ambassador of Italy to the P.R.C., H.E. Massimo Ambrosetti, followed by speeches from CICC Chairman Lorenzo Riccardi, Director General for the International Promotion (MAECI) Mauro Battocchi, Vice President of Confindustria Barbara Cimmino, President of Italian Trade Agency (ITA) Matteo Zoppas, President of SIMEST and International Affairs Officer of Cassa Depositi e Prestiti Pasquale Salzano, and by Donato Roberto Morea, Chief Representative, Head of Shanghai office of SACE, and Gianni Di Giovanni Chairman Eni China and State Representative of the European Chamber in China.

Among the participants also Marco Midolo, First Councilor, Head the Economic and Commercial Office at the Italian Embassy, Francesco Pensabene, Director and Coordinator of the ITA/ICE Agency in China and Mongolia, and Federico Roberto Antonelli, Director of the Italian Cultural Institute in Beijing.

“Mutually beneficial relationships under the banner of reciprocity are needed to ensure equal access conditions to the markets, including a more pronounced convergence of standards and technical regulations, a the gap which entails significant additional costs, especially for SMEs. This is also why large companies with a presence in China can play the role of business ambassadors, and drivers within supply chains, sharing experiences and networks, accreditation with local authorities and other key elements for a better understanding of the market. Suffice to mention that, according to the Confindustria Study Center, the export potential of the Chinese market is 2.4 billion euros for consumer goods alone and 2 billion for capital goods.” Barbara Cimmino - Vice President for Export and Investment Attraction at Confindustria

“China continues to be confirmed as strategic for Italian exports: Beijing ranks among the top destinations for Italian exports globally, being the main market in Asia and the second among non-European countries, after the United States. The growing number and value of institutional missions in the country significantly promote economic relations between Italy and China, which count on a stock of Italian foreign direct investment in China of more than 15 billion euros based on ISTAT data, including more than 1,300 manufacturing investments that distinguish the majority of companies present with 130,000 employees and a turnover of 33 billion euros.” - Lorenzo Riccardi CICC Chairman

Present at the table, spearheading enterprises in the various sectors, were ANFIA, ASSICA, Farmindustria, Federmacchine and Sistema Moda Italia, who presented their visions and expectations prospects in the future relations with their Chinese counterparts.

Present for ANFIA was its President, Roberto Vavassori, who explained to his Chinese counterparts the supply chain competencies present in Italy, and the reasons that suggest a rebalance between larger direct investments made by Italian companies in China, compared to those of Chinese companies in Italy, with a gap, according to data provided by ITA/ICE, of about 5 billion euros. A figure that - according to Vavassori - leaves room for the presence of at least one Chinese vehicle manufacturer in Italy.

ASSICA stressed that although the Chinese market is closed to the import of pork products due to African swine fever, it strongly believes in the country to which it exported 60million euros until 2 years ago. The hope is that the possibility of exporting under shared sanitary protocols between Italy and China can soon be resumed with the commitment of the institutions of the two countries.

Farmindustria then pointed out that China is the second non-European partner for Italy after the U.S. in pharmaceuticals and is pushing hard on investments in the sector, also ensuring greater patent protection. Important Italian companies have been active in China for several years and can further grow. This is also why President Meloni's current mission is of strategic importance.

For Federmacchine, China was the fourth largest market in 2023 with nearly 2 billion euros in machinery purchases. Despite a slight decline in Italian exports of the sector to China and some policies that do not facilitate trade, the Association highlighted the great opportunities offered by this market and the collaboration with Chinese companies.

Sistema Moda Italia, finally, said it was in favor of “free trade” in international trade as a pillar of competitiveness, but stressed the importance for the textile-clothing sector of fair and advantageous trade relations for Italian producers, respecting the “level playing field” and the rules of safety, traceability and quality of imported products, especially e-commerce products, as defined by European standards.