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Italy welcomes crackdown on fakes: Monti

2014-09-22 10:44 Global Times Web Editor: Qin Dexing

Bilateral relations between China and Italy are on the verge of a new beginning after the two sides issued a three-year action plan to strengthen economic cooperation during Italian Prime Minister Matteo Renzi's official visit to China in June.

Chinese Premier Li Keqiang is scheduled to visit Italy in October and attend the Asia-Europe Meeting held in Milan. Global Times (GT) reporter Chen Yang had an exclusive interview with Riccardo Monti, president of the Italian Trade Agency (ITA), during his visit to Beijing over the weekend. He talked about the growth potential of Sino-Italian trade, the agency's effort to crack down on fake Italian brands and the effect of China's anti-corruption campaign on Italian luxury product sales.

GT: As a government agency, ITA aims to boost trade between China and Italy. The bilateral trade volume amounted to $43.33 billion in 2013, with exports from Italy to China accounting for nearly 40 percent of it. How can the trade imbalance be solved?

Monti: Italy and China highly complement each other. China's 12th Five-Year Plan (2011-15) is addressing some issues, such as the capital inflows, massive foreign exchange reserves, as well as the trade imbalance.

So if Chinese people increase their consumption and Chinese companies speed up overseas investments, I think Italy will be an important destination for Chinese investment, and trade between the two countries will also improve.

China has recorded trade surpluses with most of the developed economies including Italy due to its nature. China is the so-called factory of the world, with electronic and consumer goods made in China in large quantities. In the long term, Italy aims to boost exports to China, including fashion and luxury items, machinery equipment and pharmaceutical products, which will help gradually ease Italy's trade deficit with China.

GT: ITA has also focused on stopping counterfeiting. In 2012, it submitted a list of 30 fake Italian brands to Chinese authorities that had misled Chinese consumers. How successful has your agency been in cracking down on counterfeit products in China?

Monti: Our agency has devoted considerable resources to the China market in the past year. For instance, we have re-established a counterfeit desk in our Beijing office since July. The desk is comprised of legal experts, and aims to take every case of counterfeiting or violation of Italian intellectual property rights to court with the help of the Chinese government.

We are also engaging with the Alibaba Group to get rid of fakes on its e-commerce platform. E-commerce is a key field for us, as China is very big and it is difficult for Italian companies to cover every Chinese city. Therefore, a strong e-commerce platform is very important for Italian firms to reach every single Chinese all over the country.

GT: Industry reports showed one-third of the world's luxury items are made in Italy, and Chinese purchases made up nearly 30 percent of the global luxury market in 2013. However, with China's economic slowdown and ongoing campaign to fight corruption, gift-giving and lavish consumption, the country's luxury sales have slowed down. Does Italy's luxury goods industry feel the pinch?

Monti: We are happy to see that Chinese consumers are more rational in embracing luxury goods. Luxury is not paying $10,000 for a bottle of wine; it's a high-quality lifestyle. We believe the crackdown is actually a good opportunity for Italian brands that focus on the reasonable high-end market rather than the super luxury market. We will also bring a big number of mid-market Italian brands with high quality and reasonable prices to China for the upper middle class.

GT: China has launched anti-monopoly investigations against some foreign companies, with some complaining that China's investment environment is deteriorating. What is your take on China's investment environment for multinationals?

Monti: We have not seen any specific cases involving Italian companies, as they have always respected China's laws. In general, as China becomes a major global player and Chinese companies become stronger globally, we hope China would still create a welcome environment for Italian and European companies.

GT: Over 100 Chinese companies have invested in Italy so far, which is still small compared to more than 5,000 projects that Italian companies have invested in China. Is it challenging for the Chinese to invest in Italy?

Monti: There was some resistance in Italy toward Chinese investment, as some Italian companies in low-cost segments had been wiped out by Chinese players. But that's a thing of the past.

Today we welcome Chinese entrepreneurs and investors, because we understand in the globalized world having a good access to China is vital. Letting Chinese purchase shares or equities of an Italian company will provide an opening to the Chinese market.

We are seeing more Chinese investment in Italy ranging from food to fashion.

Chinese investors have also become more professional. When they come to Italy, they always bring their lawyers and bankers.

We expect Chinese investment in Italy to double in the next few years.

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