ITALY\\\


Issue 3 2015 - Freight Business Journal


Can hard-pressed Italians export their way out of trouble?


When the going gets tough, the tough get exporting. That at least is what the Italian government hopes, as it seeks to address the country’s manifest economic problems. And, from power stations to parmesan, from tiles to tech, Italy has a lot to offer the rest of the world.


Rays of hope in Europe’s contradictory country


Italy has been at the centre of the Euro storm these past few years, but its economic problems go back much further than that. Even during the supposed boom years of the late 1990s and early 2000s, its economic growth was decidedly sluggish compared with many other EU countries – no more than around 1.25% on average. A Reuters report cites the Paris-


based Organisation for Economic Cooperation and Development’s latest figures, which put Italy’s economic growth at no more than 0.6% this year, although this would in fact be a marked improvement on its 0.2% prediction in November – and a whole lot better than its performance over the past three years; Italy has not seen any growth at all since mid-2011. It is in fact the Eurozone’s most sluggish economy, says OECD,


though it remains its third-largest. OECD raised its forecast for


2016 growth to 1.3% from its November prediction of 1.0% - hardly spectacular, but it would be a whole better than before. Not that the economists are


being wildly optimistic. OECD says that there are still risks that could derail Italy’s growth train, especially if its historically high debt levels start to get out of hand again. OECD would like to see structural reforms to Italy’s labour market, more competition, simpler legislation and efforts to tackle corruption. This is something that previous governments have tried to do but failed to follow through, it says. British politicians are always


banging on about the need to encourage small businesses and boost exports as a panacea for our


economic woes. Italy in fact has a preponderance of small family firms, many of them in niche markets. Paradoxically, though, in the case of Italy many economists think this is actually a barrier to economic growth and expansion of overseas trade;


small firms


lack the resources to borrow or mount export drives – although the Italian government is making efforts to address the problem and encourage small firms to export more. Despite the manifest problems,


there are good points to the Italian economy. While it has been hurt by the Euro crisis, its financial sector wasn’t as badly exposed to a tumbling real estate market as in the UK – or Ireland. The new centre-leſt


Government under


prime minister, Matteo Renzi, took office in May with the avowed


aim of reducing the country’s ballooning debt, reforming the labour market and pursuing much-needed structural reforms. The country’s banks have passed European Central Bank stress tests and there are signs of life returning to the capital markets. Inflation seems to be well under control, at least at the time of writing. Indeed, OECD says that if Renzi’s


reforms are fully implemented over the next two years, they could raise GDP by a whole 6% in ten years’ time. In many ways, Italy is a country


of contradictions. Agriculture is still important in many regions, but industry is where most Italians make their living. It produces a lot of high quality luxury goods such as shoes and expensive suits, but also a lot of agricultural goods, some of them high-end but others


Hungary for growth in Italy Hungarian road transport


company Waberer International has set up a new company in Milan in response to a 10-15% increase in local business. It follows the setting up of subsidiaries in Paris and Felixstowe over the past few months. The European full trailer load


specialist has had a presence in Italy for several decades, and business increased 14% last year, to the point where freight with origin or destination in the country generate almost one-fiſth of Waberer’s annual revenues of €500 million. In fact, Waberer’s Italian market


volume is nearly equal to the English and French markets combined. Some 26% of the freight are


Italian products delivered to the UK, over 20% to destinations in Germany, 19% to France and nearly 10% to Hungary. However, while 22% of the freight to Italian destinations originate from Germany, 21% from France, 17% from Hungary, only 10% comes from the UK. Waberer deputy chief executive,


Ferenc Lajkó, said: “Large enterprises and manufacturers in the Italian supply chain are our traditional and satisfied customers.


Our growth in the Italian market has been unbroken for years, despite the economic crisis. “The new company will


allow us to offer our customers an even more comprehensive service. Currently, Italy is one of our company’s most important markets; the need for establishing an appropriate representation was beyond dispute”. Logistics expert Alessandro


Monti has been appointed development director. His task is to double Waberer’s revenues in the country. He explained: “I do my best to deliver on the expectations of


the highly demanding and cost- sensitive Italian customers as fully as possible. My efforts are supported by one of Europe’s youngest, most


state-of-the-art


fleet of more than 3,300 truck- trailers. The environment-friendly vehicle fleet allows us flexibility in providing the required capacity. My ambition is to ensure that we are able to arrive at any loading point in the country within 12 hours, even with as many as 100 truck-trailers, if our clients so require.” Thanks to advanced telematics,


Waberer’s trailers have a loaded ratio of over 90%.


at the basic of the spectrum. The country has a long, rural and


mountainous ‘tail’ – geographically almost a mirror image of the UK. Perhaps it’s for this reason that the pallet networks have concentrated their early expansion into Continental Europe on Italy. It’s also quite a regionalised


country. UK-based freight forwarders


and transport


operators seeking to develop markets in Italy might find it better to home in on one specific local area and get a good foothold there, rather than attempt to cover the whole country. Some have even developed useful business in very specific commodities, such as tiles or tomatoes.


Transport infrastructure in


Italy is for the most part modern and well maintained. While the Alps form a natural barrier to its physical communications with the rest of Europe, the mountains have long been pierced by road and rail tunnels and the latter are soon to be joined by the new Gotthard Base Tunnel which will make transit to Switzerland and the EU even swiſter. Most of the country’s ports are


modern, particularly the new breed of transhipment hubs such as Gioia Tauro that have been built in the last couple of decades, and it is well placed in terms of the main shipping lanes to Suez and the Middle and Far East.


Positive vibes despite tough times


Gefco Italy has seen “positive trends” with an increase in the first half of 2014, and a more prominent rise in the second half of the year, says managing director, Abel Lamè. He adds: “We have also recorded year-on-year positive results both in terms of traffic and returns in almost all sectors and processes. In particular, positive results were seen for air traffic and this sector has now regained its pre- crisis values. The only exception has been transhipment sea traffic which has fallen by - 4.1%.” The increase in uptake of


national traffic was also significant with a rise of 2.1% in full load road and 1.3% in groupage. This indicates a much anticipated


upsurge in the consumer market, says Lamè. Gefco Italy plans to continue


its expansion in other markets such as eastern Europea, Asia and South Africa, as well as extending services to focus on market segments with strong growth potential, such as fashion and beauty . The company has also further


expanded its domestic network “and strengthened it to enable us to reach a higher specialisation level for the distribution of spare parts.” Unfortunately,


though, the


serious economic crisis that began in 2008 has made the gap between North and South even more evident.


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