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Italian trade fair sector for a new industrial policy

Milan, 24/09/2018, National Roundtable

Discussions at this National Conference kicked off with the observation that Italy’s trade-fair sector is a key tool for promoting the country’s economy. Not only do successful events have an important economic impact on the area in which they are hosted, with a potentially greater than tenfold multiplier effect, but trade fairs also offer crucial support to businesses.

Held up as the first and most evident impact on a given locality’s industrial base was the improvement in export performance. Yet empirical data also indicates that participation in trade fairs is a driver of modernization and innovation in firms, especially small and medium-sized enterprises that are the economic backbone of the country.

It was stressed, however, that if the Italian trade-fair and exhibition circuit wishes to better serve economic development, it still needs to address several issues. Indeed, the Italian system, despite ranking second in Europe, continues to present various imbalances and vulnerabilities. While on the one hand there is an excess supply of salable spaces, on the other the trade-fair industry hinges on a single strong operator, FieraMilano, which covers more than a third of the market in sold spaces.

It was felt that the first step in restoring balance to the system would be to look at trade fairs from a business perspective: Italy has trade-fair districts that are clocking up high rates of growth, while others are constantly losing money, propped up solely by public subsidies. From this point of view, a clearer allocation of public resources is needed to avoid support to local authorities amounting to just parochial handouts, but rather to ensure that it serves as an investment linked to tangible outcomes for the local economy.

Moreover, it was urged that any reform of the trade-fair system should be predicated on prior thought being given to the issue of governance, which is particularly complex in a sector that involves a wide array of actors, ranging from public bodies to businesses, taking in industry trade groups along the way. The risk is that this complex web may curb the competitiveness of a system that, despite registering a certain improvement in terms of economic results, is still losing ground compared to its main competitor, namely, Germany. 

The solution proposed was that of creating a network of alliances that eliminates inefficiencies and provides the various trade-fair operators with a clear role. While it was conceded that the main hub, Milan, cannot work alone, it was also considered necessary to find the best way of ensuring that the roles of different localities are matched by an ability to attract international operators.

Lastly, the participants emphasized the need to bear in mind the effect of globalization and the digital revolution, two factors that are changing the trade-fair landscape worldwide. Italy must take up the challenge of modernization and, for this reason, requires substantial investment in both trade-fair districts and organizers. After all, in a world of increasing competition, in which even the trade-fair sector has seen an intense flurry of mergers and acquisitions, failing to address the critical issues affecting the country’s trade-fair system would mean losing an opportunity for growth not only for this sector, but also for a great proportion of Italy’s medium-sized exporting firms.