Italian firms eyeing more alliances to boost economic ties

Italy will look to increase exports of goods that appeal to young millennial customers in China, the biggest drivers of consumption, as part of its efforts to boost e-commerce cooperation, officials said.

Carlo Ferro, president of the Italian Trade Agency under the ministry of economic development in Italy, said that Italian companies are actively seeking opportunities to gain a bigger market share in China, and are mulling options, such as sales of innovative products or services online, to attract young Chinese buyers.

"This is particularly so for businesses in wine, design, fashion, and furniture ... they are eager to get closer to Chinese consumers and create more modern and tech-savvy products to meet their diverse demands," Ferro said, adding that e-commerce is an effective way for the companies to achieve this goal.

"During our visit to China, we held discussions with government officials and companies, especially e-commerce firms like Suning and JD," he said.

According to ITA, representatives from Italian brands were also part of the discussions that the delegation had with Chinese e-commerce firm Suning. The two sides inked an agreement for cooperation in online and offline distribution of products.

"We are excited about this collaboration as it combines the excellence of Made in Italy with the innovations of the Suning sales model. Thanks to its logistics network and innovative technologies, many Italian brands can now be known and appreciated by a new generation of Chinese consumers," said Ferro.

This March, ITA reached an agreement with Suning, under which the Chinese e-commerce giant promised to introduce 150 Italian brands on its platform this year, and will select and introduce 200 brands every year from 2020.

"Currently there are still gaps in the perception of products, between consumers on one side and producers on the other. We have many products that reflect the culture, the creativity of the maker, and this is not necessarily understood in China. We need to do more to promote a better mutual understanding among citizens, aside from strengthening economic ties," Ferro said.

The momentum created by the Belt and Road Initiative could be an opportunity, Ferro said.

"The Belt and Road Initiative is a framework that can facilitate (multifaceted) relationships and create new momentum to facilitate economic exchanges," Ferro said.

"Italy is the first country that is involved with the Belt and Road Initiative among G7 countries. It is an important step that is seeing new momentum," Ferro said.

Ferro's visit to China follows a joint declaration between the two countries to enhance financial market cooperation and facilitate two-way financial market access earlier this month. The joint declaration was released after the first China-Italy Finance Dialogue in Milan.

Wang Xiaosong, a researcher at the National Academy of Development and Strategy of Renmin University of China, a think tank, and a professor in economics with the university, said trade between China and Italy has great potential as China has a large demand for smart manufacturing, which Italy is good at. But this is not something that many business owners in China are aware of, he said.

"Chinese companies have built strong relationship with German and French manufacturers in the past years. However, not many people are aware that Italy also has many good brands in high-end product manufacturing with innovative technologies. With increasing communication and cooperation between the two countries, the outlook for trade is very promising," Wang said.

According to Wang, the Belt and Road Initiative will bring great benefits to the involved countries, as it can strengthen economic ties and promote multifaceted communications.