Pest Analysis of Italy

PEST analysis of Italy 1) Political Environment From the political point of view Italy is an ideal country where to export our product. It has good international relationships, especially with other EU countries where we are already present and with the USA. There are no restrictions to the importation or the exportation of capitals and goods. The accounting system follows the International Accounting Standards (IAS), the same adopted by all EU countries, and quite similar to the American’s General Accepted Accounting Principles (GAAP).

There is a stable political regime with a multi-party system, which can ensure the certainty of law and the respect of contractual rights. However lawsuits tend to be lasting and expensive, and this could represent a risk in case of a contractual breach. 2) Economic Environment The Italian Economic Environment is also quite good for our project. Italian economy is based on services and industry. The per capita GDP is $30. 200, that is not high as in the United States ($44. 00), but which is however enough to ensure the population with the possibility to save some of their budget for the acquisition of expensive products. In addition income is better distributed than in the US: looking at the Gini Index, Italy has a 36 and US have a 45 (where 0 means equally distributed and 100 means unequally distributed). If we bear in mind the different dimensions of the two countries all the other economic indicators can be considered similar. Just the Unemployment rate is a little bit higher in Italy, 7% against 4. 0%, but it is not very relevant. 3) Cultural and Social Actually Italy has a population of 58. 147. 733 inhabitants. The 98. 4% of them are literates, and the 66. 4% of them are aged between 15 and 64 years. It must be highlighted the fact that in Italy are present 72. 200. 000 mobile telephones: Italians have a strong culture of always being locatable, and for this reason they in average hold 1,25 mobile phones. 4) Technological Environment We are not interested in assembling our product directly in Italy, but just n importing it from the countries where we have already established some plants. For such reason, from a technological point of view, we are mainly interested in the level of transportation and telecommunication infrastructures, rather than in the research intensity or in the university system. Italy actually has 19. 459 km of railways (16th in the world), 484. 688 km of roadways (11th in the world), and 133 airports distributed on the territory. The telephone system is modern and well developed, fax is widely used and mobile signal covers almost all the italian territory.