The Italian economy has been helped by companies driven online by a pandemic

Pierangelo Masciadri has been selling ties from his small home workshop on the shores of Lake Como since the 1970s, but the pandemic has forced it to make its sales online.

As companies across Europe closed their doors during last year’s closures, Masciadri, which has tens of thousands of customers around the world, including former U.S. President Bill Clinton, set up shop on eBay. . “It was a big revolution for my business,” Masciadri said.

“Who would have thought to know what search engine optimization was in the mature old age of 70 years. . . When the first order arrived, I couldn’t believe it was really happening. “

He is not alone. Italy’s rising commodity exports have become a key driver of the country economic recovery of last year’s historic recession, driven by a rapid rise in companies using digital technology.

In April, merchandise exports were 6% above January 2020 levels, the strongest growth rate of any major eurozone economy, compared to rates of less than 1% in France and Germany. As a result, the trade surplus of goods in Italy has increased since the beginning of the pandemic.

Online retail sales volumes increased by more than 50% in January 2020, well above the eurozone average of 42%.

It is not before the hour. Italy has long been a digital lag. In 2015, a year before Rome launched an industrial plan aimed at boosting technology investment, less than one in 10 small and medium-sized businesses was sold online, only half the eurozone average.

This has since improved by 6 percentage points, but still leaves the vast majority without an online sales operation. This has hampered Italy’s productivity, which has not only been hit by the crisis, but has barely grown in real terms since the turn of the millennium.

Andrea Basso, commercial director of Aptos Italy, a company that sells retail technology mainly to small and medium-sized businesses, said that because many companies had faced “extremely limiting situations” during the pandemic “they have therefore forced to find creative solutions, accentuating the digitization process ”.

“Very small businesses, in particular, have realized the importance of an extremely fast reaction time if they want to compete,” Basso added.

Dario Carosi, who runs Mondo Convenienza, which designs, sells and distributes furniture and home accessories, said digital investment had been the key to keeping the company’s turnover at 70% of normal levels, even during the most acute phase of the pandemic.

The digital division the company created in 2017 “saved us,” Carosi said. Since then, the company has shifted more resources to digital projects, recognizing that the relocation of its online customers has come to stay.

Digitization and innovation are also at the core of Italy’s ambitious post-pandemic reform program. Mario Draghi, Italy’s prime minister, took office earlier this year pledging to review the country’s notoriously slow bureaucracy and legal systems.

It wants to use the 205 billion euros that Rome will receive its share of the EU recovery fund digitize the economy, as well as in infrastructure projects, climate and environmental initiatives, education and health.

At a press conference last month, Draghi said digitalization was “of the utmost importance” to reduce socio-economic inequality and help the economy recover from the Covid-19.

“It is one of the most urgent priorities of the government,” Draghi said. “Many of the projects [in other sectors of the economy] it could not be done without taking a step forward by digitizing our public administration and our planning capacity. “

Massimo Rodà, senior economist at industry pressure group Confindustria, said digitalisation was “a decisive factor in a country’s economic development and in improving its competitiveness”.

“It changes consumption and production patterns, business models, preferences and relative prices and also affects policy-relevant variables such as employment, productivity and inflation,” he added.

This helps alleviate the economic impact of the pandemic. Italy was the only major eurozone economy to grow in the first quarter of this year. His production expanded 0.1 percent of the previous three months; by contrast, the euro area as a whole contracted by 0.3%.

“The whole future of Italy lies in digitization and current circumstances have led to the unblocking of a modernization process for a country that has been at a slow pace for too long,” said Irene Finocchi, professor of computer science at the LUISS University of Rome. . “This is finally an opportunity to catch up with other countries.”

This change during the pandemic means that more Italian companies are enjoying the benefits of their unexpected and rapid transition to digital commerce.

Maura Maitini has a shop selling religious items and liturgical vestments in the medieval city of Assisi, a popular destination for pilgrims. He said his business had been “almost flattened by the pandemic” until he set up his online store.

“The first item we sent was a chalice for Holy Mass,” he said. “Of course, human contact is important, but faith also evolves with technology. Sometimes when someone asks for a pendant or a rosary online, I bless them in church before I send them. ”