The association agreement with the European Union opens new opportunities for San Marino, but it also imposes limits on the Republic’s economic policies. A detailed analysis published by Liminal Futures examines the advantages, constraints and prospects involved, identifying the manufacturing industry and innovation as the main levers for the country’s development.
According to the study, San Marino will retain autonomy over direct taxation, the entry of skilled non-EU workers, and matters not governed by European law. However, incentives for businesses will have to comply with EU state aid rules and demonstrate that they support genuine economic activity.
The Republic maintains a tax advantage over Italy, with a corporate tax rate of 18% for the 2026-2030 period, compared with Italy’s 24% plus the regional business tax (Irap). These benefits, however, will no longer be able to favour companies lacking a real productive presence.
Manufacturing accounts for roughly a third of San Marino’s added value and, according to the analysis, is the sector on which investment should be concentrated. Among the well-established industrial players cited are Robopac, SIT, ASA and Valpharma — companies that have maintained a lasting production presence on Titano.
The situation is more delicate for high-tech companies. The number of certified firms rose from 35 in 2019 to 127 at the end of 2025, employing just over 300 people in total and generating revenues of around €106 million. The regime offers reduced tax rates of 0%, 4% and 8%, but the new rules aim to ensure a concrete operational presence within the territory.
Cross-border workers continue to play a central role, with around 70% of them residing in the province of Rimini. San Marino’s relationship with Italy, and with the Emilia-Romagna region in particular, therefore remains crucial to its production system.
The analysis also recalls the recommendations of the International Monetary Fund, which calls for better infrastructure, greater labour market flexibility, tax modernisation and a more efficient public administration.
Several issues remain unresolved, including the introduction of VAT and the overhaul of hiring procedures, while on the innovation front, limited investment in research emerges as a key weakness.
The University of San Marino has around 2,000 students, yet the state research fund amounts to just €150,000 for 2026. According to the study, this figure highlights the need to strengthen scientific expertise in order to seize any opportunities offered by European programmes, starting with Horizon Europe.
