Germany, France and Spain in trouble: industrial output drops threaten €300 billion in trade with Italian small businesses
European industry on the brink: April slowdown alarms Italy
In April 2025, Europe’s industry sent a clear warning signal, raising concerns for Italy’s economy, which is deeply integrated with the Eurozone’s productive system. According to Unimpresa’s research center, the three main economic partners of Italy – Germany, France and Spain – all saw a monthly drop in industrial production.
Germany, Europe’s manufacturing engine, registered a 1.4% decline, reversing the temporary boost seen in March. France suffered an identical -1.4%, dragged down by energy and oil refining sectors. Meanwhile, Spain experienced a smaller contraction (-0.8%) but it still marked the end of a two-year positive trend.
Why Germany, France and Spain matter (a lot) to Italy
The message is clear: when Germany, France and Spain slow down, Italy’s economic engine loses power. Together, these three countries account for more than €300 billion in annual trade with Italy, forming the core economic network for Italian SMEs focused on intra-European exports.
- Germany is Italy’s top export destination: over €70 billion yearly, with close integration in mechanics, automotive and chemicals.
- France absorbs over €60 billion of Italian goods, particularly fashion, food, pharmaceuticals and components.
- Spain reached almost €50 billion in 2024, driven by energy, automotive and consumer goods.
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These production declines aren’t just stats: they mean fewer orders, lost revenues and supply chain delays for Italian manufacturing SMEs. The European industrial supply chain is highly interconnected, so any weakness in major markets quickly affects Italian competitiveness.
Giuseppe Spadafora, Unimpresa Vice President, warns: “This simultaneous slowdown among our key partners is a systemic risk for SMEs, especially the export-driven ones.”
Cautious hopes and fragile recovery
Despite the challenges, there are mixed signals. Spain, though down monthly, shows a +0.6% yearly increase, standing out against France (-2.1%) and Germany (-1.8%). In Germany, some confidence indicators hint at stabilization, though recovery remains fragile.
Italy must now diversify its export markets, invest in innovation and strengthen international collaboration networks to avoid being dragged into the slowdown.
FAQs
1. Why is Italy worried about the EU industrial slowdown?
Because over €300 billion in trade depends on Germany, France and Spain.
2. Which partner is the most important for Italy?
Germany, with more than €70 billion in exports annually.
3. What caused the drop in Germany?
The fading of temporary Easter effects and a sharp decline in exports to the USA.
4. What happened in France?
A fall in energy and refining sectors due to milder weather and structural weakness.
5. Why is Spain doing better?
Despite a monthly dip, Spain’s yearly industrial growth is still positive.
6. Which Italian sectors are most exposed?
Fashion, mechanics, pharmaceuticals, energy, automotive, and components.
7. What’s at risk for Italian SMEs?
Lost orders, increased costs, and disrupted supply chains.
8. Is the German industry recovering?
Some indicators suggest it’s stabilizing, but it’s still a fragile situation.
9. How important is intra-EU export to Italy?
It’s a major share of Italy’s manufacturing GDP.
10. What should Italy do?
Diversify markets, invest in SME innovation, and expand beyond Europe.
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