28/07/2022
11:58

The NRRP and opportunities for SMEs

The NRRP (National Recovery and Resilience Plan) consists of an investment package divided into six “missions”, with the parallel aim of promoting an ambitious reform agenda with regard to:
  • government agencies;
  • justice;
  • simplification;
  • competitiveness;
The entire Italian NRRP draws on a total of 191.6 billion Euros and covers a wide spread of interventions, and these in turn have been divided into six sections, known as “missions“:
  • Digitisation, innovation, competitiveness and culture – 40.32 billion Euros
  • Green revolution and ecological transition – 59.47 billion Euros
  • Infrastructure for sustainable mobility – 25.40 billion Euros
  • Education and research – 30.88 billion Euros
  • Inclusion and cohesion – 19.81 billion Euros
  • Health – 15.63 billion Euros
The NRRP is not limited to Italy. The European Union is allocating 503.62 billion Euros towards Recovery and Resilience Plans for individual countries. Italy comes second in terms of the size of its grant, preceded by Spain and followed by France with 40.9 billion Euros. The Netherlands is the only country not to have submitted a plan.

Banca Ifis, together with the SME Market Watch, is constantly monitoring the challenges and priorities expressed by Italian SMEs, including in relation to the NRRP. Surveys taken in 2022 have indicated a limited knowledge of the NRRP, and its possible effects on the individual business or on the sector to which it belongs.

Around 25% of entrepreneurs expect the NRRP to have positive effects on their sector, a figure that rises to over 30% for the Mechanics and Technology sectors. The positive response fell to 22% when respondents were asked to assess the direct effects on their business.

Only 15% of SMEs currently feel they will benefit from the incentives offered by the NRRP. Once again, it is the Mechanics and Technology companies that are most positive, at the rate of about 20% (the highest figure seen at the moment).

Those SMEs that will benefit from the incentives will mainly do so in the following 3 areas:

Digitisation and innovation in the production system

69.7%

Use of renewable energies (e.g. use of green energies in production processes and modernisation)

41.1%

Energy efficiency and redevelopment of company offices and/or production sites

48.9%

Finally, those who will benefit from the incentives think they will bring the following advantages:  

Growth of the company in its reference market

34.3%

Improvements to quality of products

18.3%

Improved time-scales

11.6%

Greater efficiency in reusing materials

9.5%

Reducing the impact of the company on the environment

22.4%

Cost reductions

44.8%

Increased energy efficiency

36.7%

In its Economic Bulletin of July 2022, the Bank of Italy estimated that the NRRP would add 2% to the country’s GDP over the three-year period of 2022-24. However, it should be pointed out that the investments and reforms financed by this Plan will create a more modern ecosystem, improving both the well-being of citizens and the competitiveness of businesses.

Finally, we should also note that the plan includes measures for the direct involvement of SMEs. The following breakdown was produced by the Il Sole24Ore research office:
  • Mission 1, investment 1. A management retraining scheme will be developed and tested, focusing on SMEs in particular. It will include practical training programmes, the involvement of trade associations, and the use of digital platforms to disseminate information.
  • Mission 1, investment 5.
    • Sub-measure: The refinancing and redefinition of Fund 394/81 managed by SIMEST. This intervention aims to support SMEs in the process of internationalisation, drawing on the services offered by the Fund enabled by Law 394/81 and managed by SIMEST. The financial resources will be channelled into investments to support Italian SMEs and encourage their increased competitiveness in terms of innovation and sustainability, with inevitable positive effects on their success in international markets.
    • Sub-measure: Competitiveness and resilience in production chains. The support for SMEs will also include a focus on production chains. This intervention is aimed at providing financial support for investments through the Development Contracts measure, operational since 2012.
  • Mission 2, investment 2.1. Strengthening the export capacity of Italian agri-food SMEs.
  • Mission 2, investment 3.1. An initial statistical survey undertaken in 2011 showed that industrial zones in Italy covered a total of approx 9,000 km²: an area about as large as the region of Umbria. Most of these zones are strategically located, to help in building a more localised hydrogen network for production and distribution to neighbouring SMEs. The project aims to promote the local production and use of hydrogen in industry and local transport, with the creation of so-called hydrogen valleys: industrial areas with an economy partly based on hydrogen.
  • Mission 4, investment 1.5. Resources for financing, by 2026, twelve “local R&D champions” (existing or new). These will be selected using a particular competitive process, with a focus on their ability to promote social sustainability initiatives. The requirements include the creation of a research project and/or of research infrastructure, in a joint initiative between universities and local companies – in particular SMEs.
  by
Carmelo Carbotti
Head of Strategic Marketing and Research Department
I did economics at university, and keep myself up-to-date by reading and studying. I have worked in financial services for 29 years, and have always had a great interest in corporate culture and in communicating the meaning behind the figures. I currently hold the position of Head of Strategic Marketing and Research Department at Banca Ifis.
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