The impact of economic systems ‘dispute over the trade market: focus on the Italian marble sector.

Abstract

Since 2018, the world' two largest economies, China and United States, have imposed tariffs on billions of dollars’ worth of each other’ goods, with the result of an ongoing fierce trade war.

US President Donald Trump accused China of unfair misconduct in trading practices and intellectual property theft. In China, the belief is that the US is trying to slow down their economic growth.

Starting with the first tariffs on Chinese exportation of washing machines and solar panels, over 1,300 product categories were lately affected by those impositions. The consequent exchanged tit-for-tat tariffs became harmful almost globally.

In this scenario of price escalation, Europe suffered losses both directly and indirectly. Italy in particular, whose growth rate were for some time now decreasing, except exportation, suffered losses in his major manufacturer production as the automotive industry and the food sector.

But in another sector Italy was dominant considering its position in the global market: this is the marble production. Historically the high quality of the raw material made Italy a key marble producer and exporter in the world.

Overall the global marble market is worth over $50 Billion. Until 2016, EU was the dominant producer of marble, but growth in emerging markets, especially in China, Pakistan and India, meant that Asia is assuming dominant position.

This sector is a highly-fragmented industry with a variety of manufacturers from large multinational corporations to small privately-owned companies. So, in such environment where the competition could be very fierce the quality of product itself constitute the only true competitive advantage. The marble market for the extremely variegated range of prices could be compared to the gemstone business. In this logic the market demand and the quality of resources became crucial to leverage the producer profit margin.

At the same time, in this sector U.S protectionist strategy that move against European and Chinese goods, foster economy of some emerging countries of the East Asia. Along with the risk of plummeting of the price of the raw material, one of the biggest fears for the marble sector was the strengthening of production volume of artificial marble and other marble substitute just like quartz and neolith. Along with the issues and threats that Italian producer may face, the quality of the product itself assume the riskiest position.

Therefore, in conclusion, in a market flooded with artificial material that happen to be cheaper but at the same time less durable, how could we correctly safeguard the pureness of the final product? How to protect the final consumer assuring the best quality in the market? And at the same time maintaining high the demand of this type of material in sake of preserve the fairest price? What are the proper measures to put in effect in order to avoid the market invasion of these kind of fake, substandard and poor materials?