Italy has been hit particularly hard by the financial crisis: the country’s average real GDP growth was nil over the period 2001-2015. In 2017, Italy’s GDP grew by 1.5%. While this is the most relevant annual growth achieved in the country in the last 10 years, it is still lower than the annual growth of other major European economies. Moreover, growth came to a standstill and consumer confidence weakened in 2018, according to reports by the Italian statistical office.
Italy is the world’s night largest economy, but it faces many challenges, including high levels of unemployment and a very large public debt. The unemployment rate stood at 10% at the end of 2018, which highlights the weaknesses in the Italian labour market and growing global competition. The state of the country’s public finances represents another major challenge. In 2017, Italy was the second biggest debtor in the eurozone and the fifth largest worldwide.
Timber sector economic trend
Just like the Italian economy overall, the Italian wood and forest products sector has started to recover in 2015-2017. In 2017, timber sector turnover grew by 2.2%, while production in the Italian timber sector grew by 5.1% (in terms of volume), more than double the growth in the year before (+2.2%).
Growth was mainly driven by furniture exports, especially the luxury segment. However, strong growth in Italian domestic demand (+3%) was also reported in 2017.
More than 50% of timber products exported from Italy are destined to the European Union, with France, the UK and Germany being the primary destination. At the same time, the importance of China and the US as export destinations for Italian wood-based products has continued to increase.
Trade with VPA partner countries
Italian wood product imports from VPA partner countries have declined sharply over the last decade. Between 2007 and 2017, imports of primary wood products dropped by 72% in volume. The fall in secondary wood products of -25% was relatively modest; however, this was primarily due to an increase in charcoal imports, with partly offset stronger decline in other secondary wood product imports. Wood furniture imports declined by 74% in volume and wood flooring imports by as much as 91%.
The main reasons cited for this continuing decline by Italian IMM 2018 survey respondents are the economic and financial crisis, a growing trend towards using temperate wood species as well as the EU Timber Regulation
Over the period 2004-2017 Cameroon was the major supplier of sawnwood to the Italian market among VPA partner countries, followed by Gabon, Ivory Coast and Malaysia. Indonesia is a major supplier of wood furniture, plywood and flooring. Other relevant VPA country suppliers were the Vietnam, Thailand and Ghana.
For more information and latest trade data go to the IMM Data Dashboard or the IMM website .