Seven deadly sins of joint ventures under competition law
Joint ventures in the energy and resources sectors.
Bringing over 21 million visitors to the city, Expo 2015 was one of the most important business events in the history of Milan. It also had the effect of drawing the public’s attention to crucial issues for the food sector, such as sustainable agriculture and farming, safeguarding biodiversity, innovation in the agricultural sector, and education on food, nutrition and food safety.
The conference has led to a renewed interest in the food and agriculture industry and an increase in the agricultural sector’s activity, but with a technological and innovative angle.
Some of the key developments since the conference include:
A recent development is the Future Food Institute initiative1, which aims to collaborate with young entrepreneurs to seek new means of combining sustainable agriculture and technological innovation.
After the Expo, the Institute surveyed 350 new start-ups, which covering the majority of the agricultural sector’s most innovative areas. Over a third of the start-ups operate in the agrotech and sustainability fields (32 per cent), in addition to the companies involved in the agricultural sector’s sharing economy (20 per cent), e-commerce and innovative means of distribution(12 per cent), safety and traceability (11 per cent), health protection (11 per cent), super foods (9 per cent) and retail (5 per cent).
The biotechnology market worldwide us worth an estimated €7 billion, of which approximately €4 billion is derived from the US. The size of the potential for growth of this sector is a source of inspiration for the fledgling Italian market.
The growth of innovative companies in the agricultural market has been accompanied by increased recognition from financial and public institutions, who appreciate the long term benefits of financing agricultural activities.
The Lombardy Region, who hosted the Expo with Unioncamere, has since launched “Start-up per Expo’, which will provide €1.5 million in funding to 25 selected innovative start-up businesses.
Emilia Romagna has also announced a schedule of competitions for 2016, which are worth €1 billion. The competitions aim to further expand the region’s food and agri-business sector, which increased three per cent in 2015 and now constitutes 20 per cent of the national total. This will be achieved through increasing exports and encouraging innovation in the region’s supply chain of over 20,000 businesses.
At a national level, the Ministry of Agriculture and Forestry has established a private equity fund worth €20 million to guarantee loans to innovative businesses operating in the agri-business sector. This fund falls within an overall framework of government intervention, with €160 million assigned to the agri-business sector. The investments aim to create a generation of young agricultural entrepreneurs, who will exploit market opportunities, through subsidized or interest-free loans of €60–80 million and tax credits, for the e-commerce activities of agro-business products.
“Investing in agriculture does not mean looking at the past, but using new tools to interpret the future.”
Maurizio Martina, Minister of Agriculture, Food and Forestry Policies.
In addition to these initiatives, the Ministry of Agriculture, Food and Forestry Policies and UniCredit have agreed to establish the “Cultivating the Future” project. This project provides €6 billion over a three-year period (2016–2018), to support investments and access to credit for agri-business enterprises, by promoting a program of training courses and through the development of innovative technological solutions.
UniCredit’s new Agribond will be launched in May which is dedicated to businesses in the agricultural supply chain. The State guarantee provided by ISMEA, Istituto di Servizi per il Mercato Agricolo Alimentare, will permit initial disbursements of €300 million, which may be increased over time.
The partnership between the Ministry and UniCredit also leds to the creation of an Agri-Business School and a partnership with Cisco Systems Italy and Penelope S.p.A. This partnership will fund and implement technologically evolved programs for agri-business companies. The Agri-Business School aims to create sustainable financial plans, to circulate innovations and to reinforce exports, which remain the driving force of the industry.
These public initiatives to foster innovation in the sector also involve medical research. The recent Human Technopole project involves seven research centres and three “macro areas’, within which 1500 scientists and technicians will use genomics and big data analytics to try to combat cancer and degenerative diseases, with special attention devoted to the effects of food on the development and the treatment of diseases. One of the “macro areas” will focus on nutrition genomics, investigating the effects of nutrition on the prevention of diseases, in order to develop new technologies to diagnose and treat degenerative diseases. The project is expected to cost €150 million per year and will require ongoing institutional funding. The Italian Human Technopole project will be unique worldwide, as it is the first to combine nutrition, genetics and big data.
All of these initiatives indicate a promising future for the Italian agri-business sector: a market where technology intersects with tradition.
The Future Food Institute is a Bologna-based entity involved in studying the future of agriculture. The institute aims to “build a more equitable world, inspiring and empowering a new generation of creative and responsible food entrepreneurs”.
Joint ventures in the energy and resources sectors.