The economy of Trentino-Alto Adige grew slightly faster than the national economy in 2007, though with signs of deceleration in some productive sectors, according to preliminary estimates by Prometeia and Svimez.
In regional manufacturing, orders and production slowed progressively during the year. Foreign demand was stronger than domestic demand, favouring export-oriented firms. The rate of growth in merchandise exports was slightly lower than in 2006.
Investment in industry excluding construction diminished; the contraction mainly involved small firms.
In accord with the orientation of Community policy, the autonomous provinces of Trento and Bolzano recently revised their instruments to support competitiveness, taking action to create local research and innovation systems. The new industrial policy guidelines concerning innovation and R&D focus more on promoting the formation of clusters of high-tech small and medium-sized firms and put less emphasis on supporting individual businesses.
Up to now activity in the construction industry has not been extensively affected by the slowdown in the real-estate cycle, the signs of which include a let-up in housing sales. The amount of public works contracts awarded during the year declined, although it continued to buoy the sector.
Tourist flows expanded again, reflecting the initiatives undertaken to extend the tourist seasons and the attention paid to maintaining high-quality supply.
Retail sales grew more rapidly in Trentino-Alto Adige than in Italy as a whole, reflecting the region's higher per capita income.
In a regional labour market distinguished by one of the lowest unemployment rates in Italy, the number of persons in work rose, year on year, at rates in line with those of 2006 thanks to the contribution of women, for whom higher employment was accompanied by a rise in the participation rate.
Bank lending to residents grew at a similar pace to the previous year and more slowly than the national average. The indicators of credit risk were basically unchanged for households and firms and remained low by comparison with those of other regions.
Lending to regional firms expanded less than in 2006; it was curbed by the weak growth in loans to businesses in Bolzano province. By contrast, lending to consumer households accelerated; a factor was the persistent strength of demand for mortgage loans, which eased, however, in the first quarter of 2008. The share of new mortgages bearing a fixed rate increased.
