Moving from Open Door to Go Global: China goes on the world stage

The paper examines the internationalization processes of medium sized firms in the main regions of the so-called “third Italy” (North-East-Center Italy). The attention to medium sized firms stems from their increasing role in the Italian manufacturing system. Typically, Italian small firms show a remarkable ability to penetrate international markets through light mode of entry (export), but have great difficulties in establishing stable form of internationalization. One of the main aims of the paper is to assess to what extent medium sized firms are able to overcome the problems of small firms in operating in the international arena. Using data from financial statements of 2001 and 2005, we analyze the percentage of sales abroad and the number, value and location of foreign subsidiaries and JVs to understand the internationalization patterns of 197 medium-sized firms. In the period of analysis, we found an increase in the level of internationalization (both in export and in direct investments), thanks especially to smaller companies (250-499 people). Anyway, most of the companies confirm the consolidated pattern of Italian manufacturing firms, based on a high level of export and a reduced level of foreign subsidiaries. As for FDI location, there is a “gap of globalization” as a strict majority of investments are located in EU. In general, medium companies seem unable to overcome the typical internationalization problems of small Italian companies