Annual Conference for the Friends of Aspen: Market, regulation, competition and SMEs

The 13th annual conference of the Friends of Aspen opened with a tribute to the recently deceased President of the Friends of Aspen, Mr Ennio Presutti. For the first time, the conference was held in Rome. Within the context of small and medium enterprise, the debate centered on the issue of how to foster and maintain competitiveness in a heightened geopolitical and geoeconomic context, whilst taking into account Italian national and European-level regulatory aspects. Now, more than ever, there is an urgent need for concrete action with a view to introducing policies and rules that are endorsed on a domestic and international level – a multilateral approach which is capable of counterbalancing state intervention with freedom of enterprise and, as regards Italy, paying attention to SMEs as a positive distinctive feature of the country. In other words, it is vital that institutions pursue solutions which are, in concrete terms, more conducive to maintaining a balance between markets and the development of businesses. The key solution proposed was that Italy should open itself up to markets without forgetting to dedicate efforts to the development of rules and ensuring compliance with them – rules that prohibit purely speculative deals, free reign being given to schemes that are out of the ordinary and the prevalence of murky balance sheets. This entails persisting in the belief that the key to dealing with the crisis is competition in the knowledge that low levels of competitiveness yield low levels of efficiency. It necessitates a full implementation, including via new laws, of article 41 of the Italian Constitution, which guarantees the freedom of private enterprise. It also means streamlining the procedures for new business start-ups as well as making life simpler for those already in existence. Yet it is important not to deny that, for various reasons, there is resistance on the part of the public administration. Nor should we overlook the real risks run by those who choose to ignore constraints that do not reward innovation. It is necessary to underline that secret cartels are illegal arrangements as they distort the free competition of economic forces in the market. Similarly, there is a need to manage the relationship between the state and the regions and act on certain distortions that are already evident. This is the difficult task facing the institutions. Unleashing the most innovative energies and forces of the real economy is an unavoidable necessity in order to give a renewed boost to the development of the production system and bring the current (originally financial) crisis to a rapid halt. Recent interventionist policies which seem to run counter to all this are justified by, linked and in reality limited to the prevailing exceptional circumstances. For SMEs, it is important that measures be put in place with respect to: access to credit and exchange rates (that is, there is a need to guard against the abandonment of fixed rates between the Chinese renmimbi and the US dollar as this would lead to a revaluation of the euro); ensuring the banks keep within the limits of real competition; the soundness of fiscal legislation (perhaps some forms of tax relief could be looked into); and the protection of patents, even if exceptions are made in certain cases. Protecting intellectual property rights is not always easy. This can only be achieved through rigorous and firm diplomatic negotiations. We are still smarting from the failure of the Doha Round. In this regard, perhaps the crisis will have the positive impact of setting certain processes in motion again. A number of critical areas were pointed to in various sectors. For instance, the presence of the state is felt in the health sector, as it is the main competitor of private businesses in this field and gives rise to situations of distorted competition. Then there is the lack of momentum in the tourism sector, where the Alitalia crisis will lead to the disappearance of smaller hotels and make it more difficult to compete with overseas markets. Nor can the issue of energy costs fail to be addressed, with environmental targets being set in the absence of technical checks and with a strong likelihood of delocalization. Competition is now between competing territories. Small enterprises which were once thought to be tied down to their individual and specific territory have, on the contrary, already shown that they can internationalize. Their success should provide us with food for thought and, to paraphrase the Italian national anthem, make us stand united so that we can overcome these troubled times together. In accordance with the practice of past Friends of Aspen conferences, the occasion also marked an opportunity to introduce new members to the group and to present the group’s past and future activities to them.