What is Italy's Trade With Canada?

Italy and its trade relations with Canada briefly

Italy is known for its fast cars, pasta, high-end clothing labels, and coffee. This tiny peninsula, which has a rich cultural heritage, has established the standard for style around the world and creates some of the most valuable goods in machinery, sophisticated manufacturing, cuisine, fashion, and automobile industries. One of Europe's most industrialized regions is Northern Italy, which has a large manufacturing base made up of small and medium-sized businesses that create high-quality products. Italy and Canada enjoy a successful business partnership. Promoting two-way investment as well as innovation and technology-based collaborations has the most potential.  Trade between Canada and Italy is substantial and expanding; in 2017, it was close to $10.5 billion. Exports from Canada to Italy totaled $2.9 billion in 2018, a 34% increase from the previous year. In this article, we'll take a closer look at Italy's trade with Canada as well as the country's shipment data and import data.

Trade relations between Italy and Canada

Italy and Canada enjoy a successful business partnership. The connection has the most potential when both parties invest, as well as when they collaborate on new ideas and technologies. Since September 21, 2017, the Comprehensive Economic and Trade Agreement between Canada and the European Union has been in effect officially.

Italy was Canada's ninth-largest worldwide merchandise trading partner and its third-largest EU trading partner in 2022, according to two-way trade figures of C$11.8 billion. The value of Canada's exports of goods to Italy was $2.9 billion, while the value of its purchases of goods from Italy was $8.9 billion as per Italy shipment and import data. The top 3 products that Canada shipped to Italy in 2022 were consumer goods, energy products, and farm, fishing, and intermediate food products.

Italy-Canada trade data

 

·         Italy exported $6.35 billion to Canada in 2021. Italy's top exports to Canada were packaged medications ($163M), wine ($457M), and platinum ($288M) as per Italy shipment data. Italy's exports to Canada have grown over the past 26 years at a yearly rate of 4.09%, from $2.24 billion in 1995 to $6.35 billion in 2021.

 

·         Canada exported $2.17 billion to Italy in 2021. Wheat ($351 million), packaged pharmaceuticals ($337 million), and soybeans ($172 million) made up the bulk of Canada's exports to Italy. From $1.71 billion in 1995 to $2.17 billion in 2021, Canada's exports to Italy have grown at an annualized rate of 0.92% over the past 26 years.

 

 

Italy ranked 7 in overall exports ($597B) and 19 in the Economic Complexity Index (ECI 1.27) in 2021. Canada was ranked 9 in overall exports ($484B) and 32 in the Economic Complexity Index (ECI) that same year.

 

Bilateral Trade between Italy and Canada

Total Canadian exports to Italy climbed by 6.9% in 2022 to reach C$2.855 billion, up from C$2.672 billion the previous year.  Italian imports, meanwhile, increased by 15.6% from the year before to C$12.098 billion in 2022 (from C$10.468 billion in 2021). These reports are recorded in the Italy shipment and import data as well.

Italy is the second-largest supplier of overall imports to Canada and ranks eighth in the globe.

Trade and investment in goods ($CDN) million:

·         $2,855 in exports from Canada

·         $12,098 in imports from Canada

AVERAGE TRADE: $14,953

Italy was the ninth-largest European destination and the 19th-largest export market for Canada in 2022.

·         $1.5 billion (-2.59%) of Italian direct investment was made in Canada.

·         $1.1 billion (+38.3%) in Canadian direct investment flowed into Italy.

 

Italy’s Trade with Canada

 

Italy and Canada had a relatively modest level of trade, but they were engaged in various economic activities. It's important to note that trade relationships can change over time due to economic, political, and global factors. Check the Italy shipment-import data or trade databases to get the most up-to-date information on Italy's trade with Canada.

However, here's some general information on their trade relationship as of 2021:

 

1.      Bilateral Trade: Italy and Canada have a bilateral trade relationship, with both countries importing and exporting various goods and services.

 

2.      Goods Trade: The trade in goods between Italy and Canada includes machinery, vehicles, pharmaceuticals, chemicals, and agricultural goods. Italian exports to Canada primarily consist of machinery, vehicles, and industrial equipment, while Canadian exports to Italy include mineral products, machinery, and agricultural products.

 

 

3.      Investments: Beyond trade in goods, there are also investment ties between the two countries. Italian companies have invested in Canada in sectors such as manufacturing and finance, while Canadian businesses have invested in Italy, particularly in sectors like automotive and technology.

 

4.      Services Trade: Italy and Canada also engage in trade in services, which includes areas like tourism, education, and professional services. Canada often attracts Italian tourists and students, while Italian companies may provide services in areas like architecture and design in Canada.

 

 

5.      Trade Agreements: The Comprehensive Economic and Trade Agreement (CETA) between Canada and the European Union, which came into force in 2017, has likely impacted their trade relationship. CETA aims to reduce or eliminate trade barriers and promote economic cooperation between Canada and the EU member states, including Italy.

 

Please note that trade figures and the nature of trade relationships can change over time due to various factors, including economic conditions, government policies, and global events.

Innovation in trade

The governments of Canada and Italy concur that collaboration in the fields of science, technology, and innovation is crucial for economic growth. As a result, the Canada-Italy Joint Action Plan in Science, Technology, and Innovation was signed by both countries in January 2015. The purpose of the Action Plan is to promote cooperation and R&D connections between significant Italian and Canadian academic institutions and universities, forward-thinking businesses, and public and private sector laboratories in priority sectors. These connections will be periodically reviewed and evaluated:

·         Aerospace

·         Agriculture, Agri-Food,

·         Life Sciences

·         the Arctic

· The study of the sea or marine sciences

Top trading opportunities for Canada in Italy

In terms of monetary value in the year 2021, the following goods were Canada's top exports to Italy according to the Italy import data:

1.      pharmacies ($930 million)

2.      petroleum products ($540 million)

3.      machinery ($218 million)

4.      Food items ($161 million)

5.      Products related to aerospace ($107 million)

6.      Technologies and automotive goods ($106 million)

7.      instrumentation for science ($95 million)

These sectors may offer prospects if Italy is on your list of potential export destinations. If you're not in one of these fields, there are a number of others that might present opportunities. Some of them are:

·         contemporary manufacturing techniques

·         smart-grid power systems

·         Paper and wood goods

·         technologies of information and communication

·         medical equipment

·         processed foods, seafood, and fish

Conclusion

The foundation of Italian business culture is based on interpersonal connections. No deal can be considered unless your Italian partners are familiar with you and feel at ease around you. It's crucial to give these connections time to develop. Negotiations could become quite tough to advance if you don't. In 2023, Canada had a negative trade deficit of C$1.01B after importing C$1.11B from Italy and exporting C$108M in return as per the Italy shipment data and import data. One challenge in the trade relationship is the geographical distance between the two countries, which can increase transportation costs. However, there are opportunities for growth, especially in niche markets and sectors where both countries have strengths. Moreover, CETA (Comprehensive Economic and Trade Agreement) has created a more favorable environment for trade and investment between the two nations.