Confindustria launches Connext Supply Chains: connecting skills, technologies and businesses to turn a geopolitical challenge into a growth opportunity for Italy

Turning a new wave of investment in aerospace, defense, and security into a driver of industrial development for Italy. With this goal in mind, Confindustria today launched Connext Aerospace, Defense and Security Supply Chains, a new initiative aimed at building and strengthening Italy’s strategic industrial supply chains, starting with a sector that is expected to be among the key growth engines of Europe’s industrial economy in the years ahead.

The launch event, held in the presence of Adolfo Urso, Italy’s Minister for Enterprises and Made in Italy, featured remarks from Giacinto Ottaviani, National Armaments Director; Lorenzo Mariani, Chief Executive Officer and General Manager of Leonardo; Pierroberto Folgiero, Chief Executive Officer and General Manager of Fincantieri; and Riccardo Procacci, Chief Executive Officer of Avio Aero.

“This is fundamentally a discussion about industrial policy,” said Confindustria President Emanuele Orsini in his keynote address. “NATO’s target of allocating 3.5% of GDP to defense spending by 2035 is not merely a financial objective it must become one of the pillars of both Italian and European industrial policy.

“This decision requires a national strategy capable of transforming that commitment into an opportunity to build a long-term industrial plan for the country-one in which investments generate innovation, skills, high-quality employment, and competitiveness. What we must avoid is allowing these investments to flow abroad. For Italy’s business community, the priority is to generate growth at home by strengthening domestic research and development. Investments in aerospace and defense consistently create significant dual-use benefits, producing strategic applications that extend well beyond the military sphere into civilian industries. Europe and Italy must recognize that only by adequately supporting their strategic supply chains will they be able to meet the challenge posed by the United States and China. Germany, France, and Spain are already reinforcing their industrial bases. According to SIPRI data, Spain increased spending in the sector by 50% between 2024 and 2025, and over the past nine years defense spending has risen from 1.1% of GDP in 2016 to 2.1% in 2025. Italy cannot afford to fall behind.”

“Space has always been a natural frontier for Italy and today represents one of the greatest growth opportunities for both the Italian and European economies,” said Adolfo Urso, Minister for Enterprises and Made in Italy and the Government’s Delegate Authority for Space and Aerospace Policy.

“It is one of the sectors where new global economic, technological, and geopolitical balances are being shaped. Competition is no longer simply among nations it is among continents and major industrial systems. Italy’s strength lies in its supply chain, which brings together national champions, highly specialized small and medium-sized enterprises, innovative startups, and industrial districts spread across sixteen regions of the country. For this reason, we have committed €7.8 billion through 2028 to strengthen the national space ecosystem and support its growth. The Artemis program-with Luca Parmitano serving as pilot of the Artemis III mission and the lunar habitation module developed in Turin by Italian industry-is a concrete demonstration of the role Italy can play in the world’s most advanced international programs.”

Urso concluded: “This is the challenge before us: transforming our industrial and technological capabilities into greater competitiveness, highly skilled employment, and European leadership in the strategic industries of the future.”

Meeting NATO’s target of allocating 3.5% of GDP to defense by 2035 could generate a cumulative increase of approximately 3% in Italy’s GDP-equivalent to roughly €51 billion—thanks to a multiplier effect estimated at about twice the value of the investments, provided that increased spending is directed toward domestic industrial supply chains.

If, instead, strategic investments were primarily directed toward imported products and services, cumulative GDP growth would be limited to approximately 0.9%.

The increase in investment is also expected to drive strong productivity gains. Industrial value added could grow by 6.5%, outpacing overall GDP growth, while supporting employment growth of 2.1%, generating additional tax revenues, and producing significant technological spillovers across the broader economy.

Italy already starts from a solid industrial foundation. According to a mapping study conducted by CTNA – the Italian Aerospace Technology Cluster – and Confindustria, the country’s aerospace sector generates more than €21.4 billion in annual revenue, employs 54,300 people, and invests approximately 5% of revenues in research and development.

More than 80% of the supply chain is composed of highly specialized small and medium-sized enterprises, distributed throughout the country and forming a key pillar of Italy’s advanced manufacturing ecosystem.