Economic policy in Europe has generally been shaped by the principles of open markets and globalisation, but this is beginning to change. Concerns over energy security, industrial competitiveness and reliance on third countries have pushed industrial policy firmly back onto the European agenda.
European policymakers are hence seeking to strengthen domestic manufacturing, support clean technologies and reduce strategic dependencies on energy and critical raw materials. Alongside new regulation, substantial public support is being directed towards industrial investment, decarbonisation and technological development.
New funding and investment opportunities are emerging, but Italian businesses must also understand how policy priorities could influence access to finance, supply chains, procurement and long-term investment decisions. Changing European priorities can impact both their immediate operations and future growth.
Europe is taking a more active role in industry
European industrial policy is increasingly focused on the relationship between competitiveness, decarbonisation and economic security. As an example, the EU’s Clean Industrial Deal includes measures to support energy-intensive industries, expand clean-technology manufacturing and create greater resilience within European supply chains.
Beyond environmental policy, this reflects Europe’s wider recognition that it must strengthen productive capacity if it is to remain competitive in sectors that are becoming strategically important to the global economy.
Public support is therefore being directed towards areas including renewable energy, industrial decarbonisation and clean-technology manufacturing. The Clean Industrial Deal State Aid Framework has also created greater scope for Member States to support qualifying investments, providing a framework for public support in areas such as clean energy, industrial decarbonisation and clean-technology manufacturing until the end of 2030.
The result in Italy is a market in which industrial strategy is influencing where capital is deployed and which investments receive public support.
New opportunities for Italian companies
Italy has a strong manufacturing base and a substantial population of specialist SMEs. This gives Italian businesses potential advantages as Europe seeks to develop more resilient industrial supply chains.
Opportunities are not restricted to large companies producing renewable energy technologies or operating in energy-intensive industries. Component manufacturers, engineering businesses, technology providers and specialist service companies may all benefit from greater investment in Europe’s production capacity.
Italy has already introduced tangible support for investments connected with clean technologies and renewable energy under this framework. In 2025, the Commission approved a €1.5 billion Italian scheme supporting clean-technology manufacturing capacity and, more recently, a €23 billion Italian scheme supporting renewable electricity production. To relevant companies, the scale of these measures makes it more important than ever to consider available incentives as part of wider strategic and financial planning.
However, public support should not determine strategy on its own. Businesses should assess how these incentives interact with their individual taxation and financing and whether the project supports their wider objectives.
Strategic supply chains are becoming more important
Renewed industrial policy is closely connected to concerns surrounding supply chain security. Recent disruptions due to conflict in Ukraine and the Middle East have demonstrated the risks associated with excessive dependence on a limited number of countries or suppliers for strategically important goods and materials.
Critical raw materials are a particularly important example. Materials used in batteries, renewable energy technologies, digital infrastructure and advanced manufacturing have become central to European economic security. The EU is consequently seeking to develop domestic capacity while diversifying relationships with international suppliers.
Italian companies should consider how these priorities affect their own procurement strategies. Businesses dependent on imported materials or components must have an idea of where vulnerabilities exist within their supply chains and whether alternative suppliers, markets or production arrangements could improve resilience.
Diversification can be more difficult for SMEs as changing suppliers will often involve additional costs or reduced purchasing power. Nevertheless, incorporating supply chain risk into financial and strategic planning can help businesses avoid becoming overly exposed to disruptions beyond their control.
Clean manufacturing and environmental considerations
There is also a growing interaction between industrial policy and sustainability requirements. European measures supporting clean manufacturing are designed not only to increase production but also to encourage lower-carbon and more resilient industrial models.
Public procurement is beginning to reflect these priorities. Under the Net-Zero Industry Act, sustainability and resilience considerations are increasingly incorporated into certain procurement procedures and renewable energy auctions. Businesses that participate in these markets may therefore find that competitiveness depends on factors beyond price alone.
International collaboration in a changing market
Industrial policy may be becoming more European in focus, but many businesses on the continent operate within the global economy. Italian SMEs often depend on international customers, investors, suppliers and commercial partners, so strategic decisions cannot be considered from a solely domestic perspective.
As the exclusive Italian member for Accounting Services of IR Global, Studio Gullì is part of a worldwide network of legal, financial and advisory professionals operating across more than 165 jurisdictions.
Whether an Italian company is evaluating a foreign partnership, restructuring an international supply chain or assessing the tax implications of overseas expansion, access to local expertise in the relevant jurisdiction can help ensure that commercial decisions reflect the full international picture.
Preparing for a more strategic European economy
Europe’s renewed emphasis on industrial capacity marks a distinct change in the environment in which businesses operate, with increased consideration of competitiveness, energy security, sustainability and supply chain resilience influencing both public policy and private investment.
Italian SMEs must understand where European policy is directing investment while ensuring that their decisions remain commercially sound. By combining accounting and tax expertise with strategic insight and an international perspective, we support clients in making informed decisions as Europe’s industrial landscape changes.
To learn more about how Studio Gullì can support your business with investment planning, tax assistance, and more, please visit www.studio-gulli.com or contact our team.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
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