Italy does not have the size and strength of other countries in Europe, i.e. Germany, but it does offer its own benefits for foreign investors and is an up and coming business environment. Three major advantageous aspects of Italian company formation include the country’s geographical position, economy, and government aided incentives. All of these factors contribute to attracting inward investment and boosting Italy’s economic value.
Italy’s position in Europe is well suited for access to the Eurozone. As the EU has expanded and incorporated eastern countries such as the Ukraine and Lithuania, Italy has become more centralised. The country neighbours other EU member states of Austria, France and Switzerland, as well as bordering the Mediterranean Sea and the Adriatic Sea. This close proximity provides a local market which is great for imports and exports, as well as travel and transport. A transport link connecting Western Europe to the Balkans region is in the process of planning and aims to further facilitate access across Europe. Italy’s industrial triangle is also favourably situated. Made up of the cities Milan, Torino, and Genoa in the north of the country, it is within reaching distance of the wealthy areas of the Rhone-Alpes in France and the Rhine-Ruhr region in Germany. Overall Italy boasts an incredibly favourable position for international businesses, with easy access to its domestic and neighbouring countries’ markets, as well as that of Europe as a whole.
In addition to the geographical advantages, Italy also has a strong economy. Business sectors such as tourism, textiles and fashion, and car production are thriving in the country. As with all EU countries, the recession has impacted upon Italy, but it still ranks highly in terms of global exports and income per capita. Foreign ownership of companies is allowed in all industries except defence related areas. Italy also offers a number of double taxation treaties worldwide, and capital and dividends can be repatriated in line with EU rules.
The Italian Government is incredibly supportive of both domestic and foreign investment. Various incentives are available that are focused on areas of high unemployment in the country. Local tax reductions for up to ten years are available, as well as 50% research and development grants, and low interest loans for promoting the export of Italian goods and services. Support is also given to larger companies on a regular basis. These companies have a significant presence in the country and support from the Italian government and authorities are in place to protect the county from detrimental dips in the economy. Some examples of companies receiving such financial support include FIAT the well-known car manufacturers, and telecommunications company Telecom Italia. Additional support comes from several family run SMEs that manufacture and produce consumer goods of a high quality. This combination of governmental and domestic companies’ support creates a strong internalised economy based upon a central domestic base.