Italy has a long history dating back to ancient civilizations like the Etruscans and Romans. It was not unified as a single country until the 19th century. Italy is a parliamentary republic with a population of about 60 million people. Its economy is the 3rd largest in the Eurozone, with key industries like fashion, machinery, automobiles, and tourism. Italian culture has had major influences in areas like art, music, and cuisine.
31. Hofstede 62 46 91 40 U.S. Italy Country 70 Masculinity 75 Uncertainty Avoidance 76 Individualism 50 Power Distance
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Notes de l'éditeur
The Minister of the Environment is Alfonso Pecoraro Scanio part of the I Verdi Party (Country Briefings Italy 2007). There is a drought right now that is affecting agriculture and electricity. Power is going off in some parts of the country because of the hot weather. The Minister of Transportation is Alessandro Bianchi part of the PDCI Party also known as Partito dei Comunisti Italiani (Country Briefings Italy 2007). Without transportation labor resources would not have access to work, and distribution channels would be interrupted. Luckily the country is about the size of Arizona, and the train is an effective way to travel. Tsunamis are the only natural disasters that would affect business operations.
The capital of the Republic is Rome. Italy has been a republic since June 2, 1946, Republic Day (Europe>Italy 2007), but the Kingdom of Italy was free as of March 17, 1861 and unified by 1870. The constitution was passed December 11, 1947 and put into place January 1, 1948. Anyone over the age of eighteen can vote (Europe>Italy 2007). There are penalties for not voting. Eighty-four and nine tenths percent of the population or forty-nine million three hundred fifty-eight thousand nine hundred people voted in 2003 (Europe>Italy 2007). Giorgio Napolitano is the President and Chief of State. He was elected by Parliament (export) in a close race, approves laws (Country Briefings Italy 2007), and nominates the Prime Minister (Italian Republic 2007). The President was re-elected on May 15, 2006 for his fourth seven-year term (Italian Republic 2007) by an electoral college of parliament and fifty-eight representatives (Europe>Italy 2007). Romano Prodi is the Prime Minister and selects the cabinet as long as it is supported by parliament (Italian Republic 2007). Both the President and the Prime Minister belong to the Center-Left Union Coalition. The Center-Left Union Coalition holds the majority of the Chamber of Deputies, but hardly the Senate. The Chamber of Deputies is led by the President of the Chamber of Deputies named Fausto Bertinotti (Italy: History, Geography, Government, Culture 2007); The Champer of Deputies seats six hundred thirty people. The Senate seats three hundred fifteen people, and is lead by the President of the Senate named Franco Marini (Itally: History, Geography, Government, Culture 2007). Both the Chamber of Deputies and the Senate are voted in through PR, proportional representation, every five years during mid-April. The Minister of Relations with Parliament and Reform is Vannino Chiti, part of the DS. The Deputy Prime Minister and Minister of Foreign Affairs is Massimo D’Alema, part of the DS. The Deputy Prime Minister and Minister of Culture and Tourism is Francesco Rutelli, part of the DL or Democrazia e Liberta also known as Margherita and Daisy. Under Sec. for the Cabinet is Enrico Letta (Italy: History, Geography, Government, Culture). The cabinet can not be fired by the Prime Minister without establishing a new government (Country Briefings Italy 2007). The Minister of Government Programs is Giulio Santaguta, part of the DL. The Minister of the Interior is Giuliano Amato; he is not affiliated with any party (Italy: History, Geography, Government, Culture 2007). The Minister of Defense is Artura Pansi, part of the DL (Country Briefings Italy 2007). The Minister of Regional Affairs is Linda Lanzilotta, part of the DL (Country Briefings Italy 2007). The regions and provinces desire more power (Italian Republic 2007). Tyrol attempted to leave the republic before (Europe>Italy 2007).
There are two major political parties like the United States. But, many different parties make up these two parties. For instance, the Left of Centre Unione is made up of; Democratici di Sinistra, Democrazia e Liberta, Far Left Partito della Rifondazione Comunista, Rosa nel Pugno, Parito dei Comunisiti Italiani, Unione Democratica per l’Europa, and I Verdi. While the Casa della Liberta is made up of; Forza Italia, Alleanza Nazionale (AN), Lega Nord, Union dei Democratici Cristiani e Domocratici di Centro (Country Briefings Italy 2007).
Crime income equals about twenty-seven percent of Italy’s GDP, and it is not being taxed (Italian Republic 2007). Less tax revenue effects the amount of money allocated to economic development of Italy. Unfortunately employees that work for these underground companies are not receiving union benefits or many other social amenities. With ten being the least corrupted Italy is about halfway corrupted on a scale of one to ten. The reality for countries is that greater inequality means greater corruption and visa versa. More crime also means that there are more risks to foreign direct investment, because this could equal more cash flows. Ninety-five percent of the population had access to drugs in 2000. From 1998 to 2000, 146 murders, 29,063 assaults, and 243,890 car thefts occurred. There were 2,205,780 total crimes in 2000 involving 60.3 out of 100,000 people (Europe>Italy 2007).
Clemente Mastella is the Minister of Justice in Italy (export). He is from the Udeur or Unione Democratica per l’Europa Party (Country Briefings Italy 2007). In Italy there is not as much judicial review in the judiciary branch as the United States. Italy operates under Roman inspired civil law or codified law that was modified by the Napoleonic Code and many statutes (export). This style of law makes business less risky, because appropriate acts are spelled out on paper and likewise enforced.
The Minister of Economy and Finance in Italy is Tommaso Padoa-Schioppa. He is unaffiliated with any political party. The Governor of the Bank of Italy is Mario Draghi, he is part of the Democratici di Sinistra or DS Party. Foreign Exchange Reserves have depleted since its peak in 2003, but 2002, 2003, and 2005 proved to be bad years for GDP growth and therefore the economy (Country Briefings Italy 2007). Both leaders must comply with the monetary policy of the European Central Bank (Hill 2006) and the EMO or European Monetary Union (Country Briefings Italy 2007). The EMO has encouraged Italy to cut taxes, raise employment and competitiveness, and decrease the deficit and debt. Italy has found success in the areas of employment through effective reforms and in 2008 pension will be given to older citizens as they are raising the retirement age. Raising the retirement age will create a pool of more experienced workers and a pool of more deficient workers depending on the industry. The taxes area of concern has improved too. Italy cut taxes in 2007 for the top bracket individuals and corporate taxes from thirty-six percent to thirty-three percent. But inheritance tax is expected only on big inheritances (Country Briefings Italy 2007).
Before 2002 the euro was loosing value because it was introduced on January 1, 1999, but according to the graph it began gaining in value (http://finance.yahoo.com/q/bc?s=USDEUR=X&t=5y&l=on&z=l&q=c&c=)
The dollar is becoming more expensive relative to the euro (Country Briefings Italy 2007).
Italy has the sixth largest market economy (Country Briefings Italy 2007). The Minister of Social Welfare, Paolo Ferrero, is part of the PRC Party. The Minister of Productive Activities and Economic Development, Pierluigi Bersani, is part of the DS Party. Bersani is going to increase competitiveness in the professional services sector (Country Briefings Italy 2007). The Minister of Public Works and Innovation, Luigi Nicolais, is part of the DS Party (Country Briefings Italy 2007). The failed state index is stable (English Website 2007). The economic freedom index is 2.65 (English Website 2007). For the past ten years the interest rate is deemed low (Europe>Italy 2007).
Inflation has been pretty well controlled over the past five years (Country Briefings Italy 2007). It has remained low for the past ten years (Europe>Italy 2007). Consumer prices and industrial prices raised no higher than one and five tenths percent in 2007, but producer prices have risen three and nine tenths percent in 2007 (English Website 2007). It is expected to remain at two percent until the year 2011 which is at the same level as the rest of the European Union, because of the strong euro and the low oil prices (Country Briefings Italy 2007).
Italy’s GDP/PPP and GDP/PPP/Per Capita is comparable to France and the UK (Europe>Italy 2007). GDP is made up of mostly private consumption then public consumption gross fixed investment, exports and imports about equally. GDP/PPP rises every year by a consistent amount since 2002 because of trade with the EU (Europe>Italy 2007), but EU trade is expected to slow. Simultaneously the real GDP growth rate has fluxuated a lot, but it is supposed to remain at one and five tenths percent until 2011 while most European countries will be at two percent (Country Briefings Italy 2007). GDP/PPP/Per Capita decreased by seventy-five dollars between 2004 and 2005 from twenty-eight thousand seven hundred eighty-one to twenty-eight thousand seven hundred six dollars (Europe>Italy 2007). The Gross National Income is one trillion one hundred twenty billion dollars in 2005 (Europe>Italy 2007).
The Minister of Labor and Employment, Cesare Damiani, is part of the DS Party. The Minister of Equal Opportunity, Barbara Pollastrini, is also part of the DS Party (Europe>Italy 2007). Human development is 934 in 2004 (Europe>Italy 2007). Forty percent of the work force uses unions. The main four unions are; General Italian Confederation of Labor (CGIL), Italian Confederation of Workers Unions (CISL), Italian Union of Labor (UIL), and the General Union of Labor (UGL). These unions no longer are pressured by politics. Thirty-five percent of membership belongs to the CGIL, the CISL, and the UIL. These three unions are part of the International Confederation of Free Trade Unions (ICFTU). All unions organize before acting (Italian Republic 2007). As of December 2006 wages are up three and three tenths percent (English Website 2007). In 2008 the age of retirement is expected to increase t his will increase the amount of experienced workers and deficient workers depending on the industry (Country Briefings Italy 2007). The unemployment rate is nine and two tenths percent which is the lowest since 1992. Northern Italy has better infrastructure since there is more investment because there is less corruption. In the south most men do not contribute to the unemployment rate, the unemployment rate is mostly affected by women and teens (Country Briefings Italy 2007). Employed workers are mostly in the services industry, followed by the commerce and industrial industry, followed by construction industry, and finally followed by the agriculture, forestry, fishing industry (Europe>Italy 2007). One million four hundred thousand people mostly work on small farms unlike the corporate farmers of America, so there is a lot of room to grow in this area (Italian Republic 2007).
Italy’s resources include, arable land, coal, mercury, zinc, potash, marable, barite, asbestos, pumice, fluorospar, feldspar, pyrite (sulfur), natural gas, crude oil reserves, and fish. Though the twenty-eight percent arable land in the south is in mountainous places unfarmable. Italy has small reserve of iron, coal, and oil. There is a lot of natural gas that mostly comes from Po Valley and the Adriatic Islands (Europe>Italy 2007).
Italy has a tourism, precision machinery, iron and steel, chemicals, food processing, textiles, motor vehicles, fashion clothing and footwear, ceramics, pharmaceuticals, and electric goods industries. Most manufacturers are small and mid sized family owned companies (Italian Republic 2007). The low end industrial producers have been effected by the cheaper Chinese goods involved in globalization (Italian Republic 2007). There were sixty-four biotechnology firms in December 2001. Italy produced two thousand seven hundred seventy-six cars, one million one hundred twenty-five thousand, and seven hundred seventy cars, and thirty-eight thousand eight hundred seventy-one heavy trucks in 2002. One in one million Italians have a communications related patent. (Europe>Italy 2007).
The Minister of Agriculture, Paolo De Castro, is an independent (Country Briefings Italy 2007). There are ten thousand eight hundred twenty-five thousand hectares of arable and permanent cropland (Europe>Italy 2007). The North grows sugar beets, soybeans, grain, wheat, rice, beef, and dairy products. The South grows citrus fruits, grapes, vegetables, potatoes, olives, durum grain, fish, and wine (Country Briefings Italy 2007).
The expected trade deficit for 2006 is four and three tenths percent of GDP, but the EMU requires a three percent minimum so Prodi has devised a strategic budgeting plan that raises taxes but does not cut spending to meet this stipulation before 2008 (Country Briefings Italy 2007). The current account balance deficit is twenty seven billion seven hundred million dollars. The trade surplus is one hundred million dollars (Country Briefings Italy 2007).
Exports in 2005 equaled three hundred seventy-two billion eight hundred million dollars. Italy sold engineering products, motor vehicles, beverages and tobacco, and minerals. Italy sold forty-seven billion nine hundred million dollars in textiles and clothing. Twenty percent of Italy’s exports were production machinery in the amount of one hundred seven billion five hundred million dollars. Ten and nine tenths percent of Italy’s exports were transport equipment in the amount of forty billion dollars. Ten and two tenths percent of Italy’s exports were Chemicals in the amount of thirty-seven billion five hundred million dollars. Twenty billion dollars of food were exported. Ten and one tenths percent of Italy’s exports were nonferrous metals (Country Briefings Italy 2007). Italy exported thirty bales of cotton in two years (Europe>Italy 2007).
Italy imports engineering products, textiles and clothing, motor vehicles, beverages and tobacco, and minerals. Production machinery accounts for seventy-three billion nine hundred million dollars of imports. Transport equipment accounts for fifty-one billion one hundred million dollars and thirteen and four tenths percent of imports. Chemicals account for fifty billion eight hundred million dollars and thirteen and three tenths percent of imports. Food accounts for twenty-four billion nine hundred million dollars of imports. Nonferrous metals accounts for twelve and four tenths percent of imports. Bananas account for three hundred forty-six million of imports. Energy products account for fifty-one billion one hundred million dollars and thirteen and four tenths percent of imports (Country Briefings Italy 2007). Oil use is one million six hundred ninety thousand barrels a day (Europe>Italy 2007). Most manufacturers imports need to be eighty percent energy (Italian Republic 2007).
Italy is involved in an Economic Union system of international economic integration. In an EU there is a common tariff and quota system among members, there are no restrictions on factor of production transportation from country to country, and there is a harmonization and unification of economic policies and institutions. In 2005, Germany received thirteen and six tenths percent of Italy’s total exports and exported eighteen percent of Italy’s imports. France received twelve and four tenths percent of Italy’s total exports and exported eleven percent of Italy’s imports. Italy is currently looking for energy from France. The United States received seven and nine tenths percent of Italy’s total exports (Country Briefings Italy 2007). Italy was the U.S.’s eleventh largest partner and had forty-two billion five hundred million dollars in trade between the two countries. Eleven billion and five hundred million dollars of United States exports were primarily office machinery and planes. The U.S. holds a thirty-one billion dollar deficit because of the strength of the dollar. In 2005 the deficit was nineteen billion five hundred million dollars, and in 2004 the deficit was seventeen billion four hundred million dollars. Foreign direct investment from United States to Italy equaled thirty-three billion three hundred million dollars. The U.S. imports broad and horse beans, cashew nuts, artichokes, lettuce, and mushrooms (Italian Republic 2007). Spain imports seven and three tenths percent of Italy’s total exports. The UK exports four and three tenths percent of Italy’s total imports. The Netherlands export five and nine tenths percent of Italy’s total imports. China exports four and two tenths percent of Italy’s total imports. Belgium exports four and five tenths percent of Italy’s total imports. (Italian Republic 2007).
The Minister of Cultural Heritage is Francesco Rutelli (Italy: History, Geography, Government, Culture 2007). The Minister of Communication, Paolo Gentiloni Silveri, is part of the DL. The Minister of Family Policy, Rosy Bindi, is part of the DL. The Minister of Health, Livia Turco, is part of the DS (Country Briefings Italy 2007). The official language of Italy is Italian (Italian Republic 2007), but English is sometimes used in business (). There is freedom of religion, but eighty-five percent of the population is Roman Catholic (Italian Republic 2007). The GINI index or the distribution of family income is thirty-six (The World Factbook 2007). Child poverty index is 20.5. Children in these families make less than fifty percent of the GDP (Europe>Italy 2007). Germans and Slovenes also inhabit Italy, but on the North side. Albanians, Greeks, Ladinos, and French also inhabit Italy.
The population grew a small percent from 2002 to 2004, but then it started to level off (Country Briefings Italy 2007). The annual growth rate is only twenty-eight hundredths percent, because there is low fertility. The median age of the population is between thirty-two and forty-five. Nevertheless, Italy has the fifth highest population density in Europe with four hundred ninety people ever square mile (Italy: History, Geography, Government, Culture 2007).
The Minister of Education, Giuseppe Fioroni, is part of the DL. The Minister of Universities and Research, Fabio Mussi, is part of the DS (Country Briefings Italy 2007). Four and one tenths percent of GDP was spent towards education from 2000 to 2002. Nine years of school is required, but most fifteen year olds stay in school another seven and two tenths years. Women barely stay in school as long as men. In 2000, thirty-eight percent of students did not like school and forty-six percent said it was disorderly. The starting salary for a elementary teacher in 1999 was nineteen thousand one hundred eighty-eight dollars (Europe>Italy 2007).
When one doing business in Italy success is measured not only by the status indicated on the professional business card but by fashion. Slacks are not permitted by either sex. Men wear quality suits and women are expected to dress quiet, expensive, and elegant. Accessories especially leather accessories add to the effect. Men’s shirts are either one color or pin-striped always matched with an Italian designer tie (Introduction 2006).
In Italy people do not say that time is money. But, only executives can be late for appointments. Business meetings and social events are very different engagements. Social events are not grounds to talk about business or ask what people do for a living. Topics usually include culture, art, food, wine, family, and movies, but exclude World War Two. However, both business events and social events are alike, because Italians all talk at the same time and the oldest, highest ranked person gets special attention. When a businessperson is invited to the home of another businessperson gifts must be given. Either gift wrap chocolate or pastries, give flowers in even numbers, or bring very expensive vintage wine. In business, decisions take a long time. There are two different business cards; professional and personal cards are given at the businessperson’s digression. Business cards are usually white with black letters and include credentials (Introduction 2006).
Italy has more power distance than the United States, less individualism, more uncertainty Avoidance, and more masculinity. On a world perspective both the USA and Italy are almost the lowest countries in the world for power distance. Also, for masculinity Italy is just below the middle for all the countries in the world (Hofstede 2006). Only nine and one tenth percent of parliament was female in 2002 (Europe>Italy 2007).
Italy chaired the EU in 1996 and supplied a president from July to December 2003 (Italy: History, Geography, Government, Culture 2007). Emma Bonino, The Minister of European Union Affairs, is part of the Rosa nel Pugno Party (Country Briefings Italy 2007). The G-8, Group of Eight, was chaired by Italy in 2001. The U.S. belongs to the G-8 and Italy and the U.S. collaborate on a lot of areas especially on terrorism. Italy just increased the size of one of the bases the U.S. is using. Sixteen thousand American’s are stationed in Italy. Italy supported the peace in the Middle East, Somalia, and Mozambique, East Timor, Bosnia, Kosovo, and Albania. In February 2003 one thousand Italian troops went to Afghanistan for Operation Enduring Freedom, OEF. Two thousand troops went to Afghanistan for Provincial Reconstruction Team. December 2006 three thousand troops went to Iraq. Italy is involved in the Organization for Economic Cooperation and Development, OECD. Italy conforms to regulation enforced by the EMU, The European Monetary Union, since it signed the Stability and Growth Pact in 1998 (Italian Republic 2007). Italy is part of the OSCE, The Organization for Security and Cooperation in Europe. Italy is active in NATO. Italy has a permanent representative to the United Nations in New York named Marcello Spatafora. Italy was part of the UN Security Council in January 2007 for a two year term. Italy is part of the GATT or the World Trade Organization (Italian Republic 2007).
http://www.nationmaster.com/country/it-italy/tax-taxation Businesses experience a corporate income tax of seven and six tenths percent. Additional regional taxes are included for businesses called IRAP in the amount of four and twenty-five hundredths percent. Components of individual taxes include; goods and service tax of twenty-six and nine tenths percent, personal income tax of twenty-five and five tenths percent, property tax of four and three tenths percent (Europe>Italy 2007), and savings tax of twenty percent (Country Briefings Italy 2007). Therefore the individual worker is usually taxed on forty-six and two tenths percent of his income. There is proportion to how much taxes are received from the poorest and the richest people. The poorest contribute six and seven tenths percent and the richest contribute sixty-two and three tenths percent.
Immigration is mostly coming from South East Europe and North Africa (Italy: History, Geography, Government, Culture 2007). There were sixty-eight thousand three hundred refugees in the 1990 to 1999 range. In 2000 there were two hundred seventy-one thousand five hundred refugees. There were eleven thousand six hundred new citizenships in 2000. For American’s permanent residence visas are picked by a lottery style (Europe>Italy 2007).
