Bioeconomy in Europe

The Intesa Sanpaolo Research Department and Assobiotec presented their second report dedicated to bioeconomy, which, in line with the definition of the European Commission, was defined as the set of activities using renewable natural resources to produce goods and energy, generating great advantages in terms of sustainability.

In 2013, bioeconomy in Italy has shown a production potential amounting to 244 billion euro, equal to 7.9% of the total value of national production, employing approximately 1.5 million people.

A global look shows that worldwide exports of products related to bioeconomy amounted, in 2014, to 2,396 billion US dollars, or 12.6% of the world trade, a share which showed a considerable growth on the 9.8% of 2007. Italy is the 10th largest worldwide exporter, with a share of about 3%, and a good competitive performance in recent years.

Moreover, in our country, bioeconomy has significant prospects of growth in the next few years, thanks to the presence of a core team of players in the downstream supply chain of bioindustry. On the basis of existing technologies, the chemical productions that can potentially be converted into bio-based ones are just under 40%, in Italy.

Developing an economy that grows while respecting the environment and reducing dependence on non-renewable resources, such as fossil fuels, is regarded as a priority for Europe and for Italy. It is, therefore, important to understand the economic potential of bioeconomy, that is the set of activities that produce and use natural raw materials from agriculture, to food industry, to timber and paper industry, to a part of the chemical industry.

The value of bioeconomy has been quantified, in the Report, through the use of official statistics, both on the value of production and employment and on the flows of foreign trade, setting out original estimates particularly for the identification of the chemical products that can be potentially produced thanks to renewable resources, on the basis of existing technologies.

In 2013, according to estimates, bioeconomy in Italy has shown a production potential of 244 billion euro, equal to 7.9% of the total value of the domestic production. In terms of employment, estimates show significant number of employees, almost 1.5 million of whom working specifically in the agricultural and food industry. On the basis of existing technologies, the chemical productions that can potentially be converted into biochemical ones are just under 40%.

An overall look at the global trend pinpoints the important role of bio-based products in worldwide trade: exports of products connected to the bioeconomy, according to our classifications, totalled 2,400 billion dollars approximately in 2014, that is 12.6% of the world trade, a clearly expanding share compared to 9.8% in 2007. Food products, with almost 1.115 billion, account for approximately 46% of total exports of the bioeconomy. The agricultural and food sector as a whole accounts for two thirds of the total, followed by biochemical products, which account for 14.5% of exports.

The study highlighted the significant role of bio-based industries in the European production and employment context. Europe plays an important role in these areas in terms of international trade, along with the United States and China. Indeed, a significant share of the trade goes on within the European Union, which reflects the high integration in the European area. Policies in favour of these sectors may, therefore, entail significant repercussions in terms of employment, as well as a significant contribution towards building a sustainable economic system.

Moreover, in our country, bioeconomy has significant prospects of development in the coming years, thanks to the presence of a core team of players in the downstream supply chain of bioindustry (both biofuel and other productions).

In 2014 the Italian production of biofuels, the only item in the panorama of the biochemistry that can be monitored on the basis of current statistics, amounted to 483 thousand tonnes, equivalent to 359 million euro. Despite the as yet modest role of our country in the world trade in biofuels, the manufacturing base highlights some positive elements: technological leadership and a multiplicity of players (both large and small producers), with facilities spread throughout the territory and expanding considerably thanks both to technological advances and the investments dedicated to the conversion of traditional petrochemical sites. Also in the field of chemistry from renewable sources Italy boasts an advanced legislative framework and positive experiences of production growth through projects designed for and integrated in the territory, with a strong focus on how to procure the necessary biomass, a key factor for the development of bioeconomy, and on the advantages that these new products can bring to the system, in terms of new jobs, protection of biodiversity, and resolution of environmental problems.

The analysis of the foreign trade flows regarding agricultural goods and food, and the study of information on the physical flows of materials, shows a significant gap in our country in terms of domestic production of natural raw materials. In our country, the level of biomass production per capita seems to be modest and lower than the amounts recorded in other major European countries.

According to our simulations, the increase, in our country, of biochemical productions up to a share of 20% of the sector’s productions, would determine an additional need for biomass equal to an annual average of 0.4%.

In order to contain our dependence on foreign countries in this field and make the most of the technological capacity that our country is expressing in the field of bio-based industries, our approach on biomass will need to be reconsidered, focusing on increased productivity, on the recovery of used land, and on a better use of the wastes from current processes, in a supply chain rationale and with a view to increasing the circularity of production systems. In this context it will also be important to formulate policies involving the use of bio-based products in all the contexts where there are high risks of environmental dispersion and where biodegradability brings global benefits to the system. This will require accessory and supporting policies, as well as the involvement of all the players in the system, from local and national institutions to associations representing the individual entrepreneurs.