The participants at this national roundtable emphasized that the steadfast development of Italy’s southern regions (the so-called “Mezzogiorno”) is an indispensable precondition for kick starting the national economy. To that end, in a pragmatic spirit and leaving rhetoric aside, it was deemed essential that the South be viewed as offering real prospects for boosting the country’s level of growth.
It was noted that the census of medium-sized Italian enterprises that La Malfa – in conjunction with Mediobanca – publishes each year highlights that, in recent years, the global crisis has led to a 20% reduction in the number of mid-sized firms in the South of the country. The crisis has had a far more dramatic impact on the South than the Northeast, underlining weaknesses and vulnerabilities that were already known to exist. On the other hand, the data shows that medium-sized enterprises in the South exhibit productivity and efficiency on a par with those in the rest of the country.
Hence, it was felt that the major challenge is to foster an environment that provides fertile ground for medium-sized businesses to emerge and prosper. Many of the economic policies of recent years were seen as not having sufficiently taken the importance of local conditions into account in favoring the industrialization of the Mezzogiorno through mid-sized firms.
The participants were therefore of the view that a complete rethink of state support measures is called for. It was posited that globalization, while creating problems for the more developed countries, gives rise to opportunities and fuels new demand for quality consumables, offering a chance to capitalize on local resources that Southern Italy has in abundance. The observation was made that the gap between the allocation of resources and their optimization and mobilization is not down to availability of funding for private initiatives, but to strategic ability to further the accessibility and utility of collective goods, including through improved synergy of public and private efforts. There was thus a perceived necessity to support local capacity to produce collective goods by more clearly focusing national and European policies.
It was acknowledged, however, that there are some – albeit partially – encouraging signs. In 2015, the positive figures that emerged in 2014 for medium-sized enterprises in the South were strengthened, with a certain increase in efficiency recorded. While weaker SMEs tended to downsize or exit the market, those more robust consolidated their position and improved their financial performance.
At this point in the proceedings, the participants turned to discuss infrastructure (linked closely to urban renewal and energy efficiency) as a necessary prerequisite for growth. A more efficient transport network was deemed crucial, both at the local level and for major hubs within the country (such as Milan) and Europe (especially the Mediterranean countries), in order to take advantage of new opportunities.
It was also noted that there are significant differences between various areas of southern Italy, evidencing an unevenness in terms of capacity to team up with other regions of the country and to latch onto international opportunities.
Italy’s Mezzogiorno was seen as in need of a more innovative entrepreneurial culture that exploits the South’s distinctive characteristics and facilitates the emergence of successful businesses. One option deemed worth pursuing was that of advanced industrial clusters, which can better adapt to specific local conditions and forge cross-sector value chains, with a strong linkage between the agrifood, crafts, and tourism industries considered in particular to have clear virtuous potential. In addition, this was viewed as a way of overcoming the fragmentation of the industrial base to enable better market positioning.
It was at any rate felt that policy choices are also required that pursue wide-ranging strategies – both at a strictly national level and within a broader European context. Leaders were urged to think in terms of the “common good”, with pragmatic initiatives linked to a holistic overview. Institutions – particularly those tasked with the administration of justice – were seen as vital in fostering conditions that encourage investment and growth.
Education and training were, in turn, characterized as playing a key role, especially in the creation of human capital but also of “social capital” that is fit for purpose. It was submitted that many recent experiences point to the need for links to be nurtured with the business world in order for tangible benefits to accrue in terms of employment.
Finally, it was observed that the future of Italy’s Mezzogiorno also depends on the ability of leaders to direct the exercise of power towards fostering the common good, in the process cultivating integrity and competence.