Italian enterprises are too small and do not invest enough in innovation, warns central bank governor
As he announced that Italy's economy will not grow at all in 2005, while its budget deficit will increase to about four per cent of GDP, the country's national central bank governor, Antonio Fazio, called on Italian enterprises to invest more in research and development (R&D). In an annual report presented on 31 May, Mr Fazio painted a grim picture of Italy's prospects and warned that some aspects of the Italian economy could compromise development in the medium-term. These include low industrial production, falling investments in innovation, the small size of Italian enterprises and declining exports. 'Our industry shows a few excellent examples of success. But this is not enough. Italian enterprises are too small and fragmented. They do not invest enough in research and technological innovation, they do not develop new products,' said Mr Fazio. Concerned about the pressure of competitiveness from emerging economies, Mr Fazio invited industrialists to intensify efforts by increasing production quality and creativity. He also called on enterprises to become 'highly qualified', and to remain 'rooted in our country' as 'they have to, they must disseminate improvement of quality and productivity to other enterprises.' For Mr Fazio, 'development capacities and fragmentation of production weigh hard on our economy. The reduced dimension is an obstacle to investment in research.'
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