International rankings have a significant impact on how countries are perceived and how investment decisions are made. In a globalized world where competition is the rule of the game, having a good rating in terms of perception is crucial and yet Italy too often has received grades way below any reasonable criteria and has not bothered much to correct the situation.
For instance Italy is ranked 77th in the Press Freedom Index behind countries like Namibia (17th) and Burkina Faso (42th) and it appears at the 45th spot in the World Bank’s Ease of Doing Business index behind Malesia (18th) and Mauritius (32th). Not to mention that Italy ranked 61th in the latest report of the Transparency Index, which measures corruption, behind Uruguay (21th) and Bahrain (50th).
It’s exactly starting from this analysis that the European House Ambrosetti, together with three major global companies as partners (ABB, Toyota Material Handling and Unilever) has launched the project of a “Global Attractiveness Index” able to better value the attractiveness of a country. “There are about 80 different rankings and indexes in the world an most of them only take into consideration one aspect of a country – explained to ItalyEurope24 Enrico Giovannini, the former Labor Minister and ISTAT president who served as advisor to the project – not to mention that often this kind of lists is made on the basis of personal perceptions, biases, misconstrued assumptions.”
While many indicators only take into consideration the economic capital of a country, the Global Attractiveness Index takes a wider view by analyzing four types of capital, economic, human, social and natural. “Let’s think of what just happened with the tragedy of the earthquake in Central Italy. – explains Giovannini – In a matter of hours the whole country had mobilized to send help to the populations hit by the tragedy. That’s social capital, and it is highly valuable. And so is the human capital, which has made our products famous throughout the world not to mention of all our researchers that are appreciated wherever they go. And of course we have an incredible capital in terms of nature and history. All these four elements go to shape the perception of the attractiveness of a country and a bigger effort must be done to improve communication of this regard”.
In this first edition of the Global Attractiveness Index, Italy ranks 14, a much proper position for a country which sits among the biggest world economies. The US, Germany and Japan unsurprisingly top the list but Italy is close to Switzerland, 11th, France, 12th, and just ahead of Austria. The new index is based on key performance indicators (Kpi) that are objective and repeatable in time and the European House has asked the Joint Research Center for the European Commission (JRC) to verify and ensure the quality and fairness of the statistics used.
“Of course this is only one aspect of the battle and not all faults lie with international indicators. – adds Giovannini – In this respect the government has its work cut out to improve Italy’s attractiveness and competitiveness.” “First of all – the advisor explains – it must strengthen the national ecosystem for innovation, for instance providing permanent incentives for R&D and support to innovative companies. Also it must speed up the transition towards Industry 4.0 taking the cue from Germany which is going full speed on automation and digitalization. Also it’s crucial to update our education system by putting great emphasis on lifelong learning, because companies and workers must be able to transform themselves constantly if they are to survive. Finally Italy needs to improve the efficiency of its services by reforming the justice system, by implementation quickly the reform of the Public Administration and by developing an integrated strategic plan for the development of infrastructures and logistics.”
One further effort must be however done at a marketing level. Institutions need to be more aware of how important is to be perceived more fairly at a global level and not let stereotypes drag the country down. At all levels, and in all occasions, our representatives, explains Giovannini, must do a better job in communicating the value of the country, in stressing the importance of our four types of capital.
“In 2014 Italy was only 25th in the world for foreign direct investments – concludes Giovannini – and only 2% of these were directed towards the South. Obviously this is not a level coherent with our importance as a country if you think for example that in 2015 we had more than $1,000 billion of trade exchange and that we were 4th in the world for industry’s added value. Perception therefore is essential and has an impact on the decision-making process of foreign states and companies.”
That’s why Italy needs a brand revamp, starting with a new index able to better reflect its value.
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