MILAN, Dec. 3 (Class Editori) -- The Silk Road is becoming increasingly digital and investments concerning connectivity and digital exchange are expected. Therefore, it can catalyze global development in the perspective of sustainability and cooperation and can be an opportunity for Italian companies. This was the main message of the fourth edition of the Belt and Road Initiative forum organized by Class Editori and mainly focused on relations between China and Italy. "Digitalization is the new globalization," and e-commerce, which for its part "created innovative payment methods," is the main driving force of this business shift, as highlighted by Du Guochen, who works at the Chinese Academy of International Trade. On the one side, cross-border e-commerce eliminates borders and therefore reduces costs in the global supply chain, thus helping to improve industrial turnover, as proved by data concerning Italian companies' exports recalled by Luca Ferrari, Italian Ambassador to China. In the first eight months of 2021, export volume grew by 30% to 13 million euros compared to 2020, equal to pre-pandemic 2019 levels. So, the "internationalization strategy of Italian SMEs especially towards China, which has around 1.4 billion possible customers" and the largest number of Internet users (900 million), is winning. On the other side, digital revolution includes e-payment innovations and in this phase "exchanging good practices and experiences is paramount".
For example, China's Central Bank already introduced a cryptocurrency law to avoid speculative purposes by launching digital yuan, which is centralized and regulated and, by now, available in "28 territories through app for the 10% of the population." According to the Ambassador, digital transition is not only a "required path," but also provides several opportunities, as proved by the important fulfillment of the new Silk Road, inaugurated in 2015. In fact, experts expect a 11,000-billion-dollar flow in the countries it crosses by 2025, with the aim of "benefitting from the technological and digital potential and therefore sharing opportunities," as stated by Li Junhua, Ambassador of the People's Republic of China to Italy, who recalled the opening of China established during last month's Plenary Session of the Communist Party based on cooperation with other countries and essential to "give more advantages to involved states," as the pandemic experience taught as well. Partnership should mainly include controversial areas as data and intellectual property regulation, market’s access and taxation and data protection "firmly and fighting against leaks and hacker attacks, without using cybersecurity to cover up trade protectionism," Li Junhua warned.
In particular, as concerns Italy, its network of SMEs can gain important advantages from digitalization and from bilateral relations with China, as highlighted by Zhai Kun, who works at the School of International Studies of Peking University and explained that digital means "can bring new lifestyle in small towns that are about to disappear." Surely, Italian SMEs should invest in the world's second largest economy and in the main EU trade partner (excepting from services), which is expected to grow by 30% in several industries over the next years. In times as the one we are currently facing, characterized by uncertainty and economic slowdown, as well, since, as pointed out by Carlo D'Andrea, Vice-President at the EU Chamber of Commerce, "as '800 was the century of Europe and '900 of the US, the current one is the century of China and of Asian countries." However, "it is not easy to do business there, and it is important to study, considering their culture is a real tangible and convertible asset able to increase the performance of a company which bets on internationalization, especially towards China," Francesco Boggio Ferraris from MF Academy stated. In practical terms, companies must "be constantly updated on market and law changes," or they risk impediments or heavy fines; it is important to have people inside the corporate structure that only deal with relations and communication with China and in Chinese, Santiago Mazza from Retex added, highlighting that companies must have a three- or four-year medium-term vision to invest in the PRC market and a cultural mediation to enter such a peculiar reality.
First of all, "Chinese people trust Chinese people" and in this framework Key Opinion Leaders can be helpful just as Italian influencers, which must be selected in a conscious and specialized way, Mazza commented. Moreover, there are differences also between Chinese provinces, as the CICC directly observed. Italian companies must therefore be supported, as ITA committed itself to doing, in the structuring of target-suitable communication, with proper visual marketing and on-sale products in line with Chinese demand. Even if "a little late", as Ferragamo's CEO Michele Norsa pointed out, awareness of the importance of sustainability has spread among Chinese people. All the Italian companies attending the forum have understood this message, from manufacturers of leather goods to cars and commodities, and, above all, both the energy sector and the steel industry have internalized it in their investment and research projects. Matteo Tanteri, CEO of Snam China, stated that Beijing is starting to make checks, which "means that things will happen" and further room will open up for Italian leading companies in the ecological transition. In the short term, China will double its gas use, and Italian storage will play a role. Investments in renewables will increase and some Italian players will take over.
Finally, the Asian power will be committed to improving production processes in energy-intensive sectors such as paper, glass and steel. Anna Mareschi Danieli of Danieli Group focused on the evolution of the steel industry in China. In order to reduce emissions within the pre-established limits, major intervention is planned in this sector, which accounts for 17% of the country's CO2 emissions. Specifically, efforts will be made to eliminate or at least minimize steel exports, to increase steel recycling, and to invest in different energy sources, primarily hydrogen, since steel is currently 20% fossil fuel based. However, according to Tanteri, in order to really aim for zero emissions, a technology to capture CO2 will be fundamental. All the above-mentioned investments in digital technology must certainly not eliminate capital flows in the traditional Silk Road, i.e., the physical one. On the contrary, as Mario Boselli, President of the Italy-China Foundation, stressed, it is necessary to find "the wise balance between online and offline." The integration between new technologies and physical infrastructure is embodied, among others, by UTLC ERA. The railway corridors to and from China not only reduce distances, with average travel times lower than maritime transport, but are also greener: CEO Alexey Grom gave as an example the China-Verona railway line that produces 10 times less CO2 than alternative means of transport.
(Source:Class Editori)
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