Are there opportunities for American investors in Italy?
Which sectors are worth investing in?
So, Italy distinguishes itself in many sectors, but really shines in the automobile sector where design, technology and skills are all top of the line. The automobile market is ever-expanding and remains attractive to foreign manufacturers. Here, the Italian market is linked with Germany (the strongest economy in the EU in terms of GDP and lack of debt) by way of steel production and is relatively stable in this sense.
The country’s most dynamic sector is the chemical industry and it ranks third largest producer in Europe, not just within the EU. The volumes of production and consumption of agricultural and food products and beverages are the largest in Europe. Italy is characterised by a tradition of typical products, culinary dishes and world-renowned wines with very high standards of quality and safety.
There are many other opportunities when considering investment in Italy. Newer technologies in aerospace, nanotech, and biotechnologies are all fair game. Italy also welcomes any investment that wants to aid in the development of Life Science projects (for which there are competitive costs and simple standards).
Where should someone invest?
There are additional aids for the creation of companies in the regions that are considered less developed, so this has mostly to do with investing in the southern part of the country. By way of example, companies investing in Abruzzo, Basilicata, Calabria, Campania, Puglia, Molise, and Sicily can benefit from a tax credit of 25%, 35% or 45%. This percentage is largely dependent on the size of the company, not the region.
Italy also has two free trade zones: Venice and Trieste. Investing in one of the free trade zones can also confer some additional tax benefits.
What are the pros of investing in Italy?
Industrial companies in Italy remain strong and they represent around 21% of Italy’s total GDP. Its small and medium-sized enterprises are very competitive with labor costs that are generally lower than those of the U.S. Italy has a very good infrastructure in the north, but this tends to deteriorate as you travel farther south, hence the increased benefits for investing in the southern regions.
The government also provides significant financial resources and deductions of up to 50% of the employees’ salaries. Other benefits include: purchase of equipment and intellectual property rights for investments in the R&D sector. Depending on the region, a company can receive up to 10 years of tax exemptions, beneficial for both the company and the unemployment rate.
What are the cons of investing in Italy?
Those looking to invest in defense, tobacco or energy networks will find that these sectors are rather monopolized and it will present an additional level of difficulty.
As a conclusion, “patience is a virtue” as the saying goes, and it’s one that can generate a large return on investment in Italy.