24/06/2024
Written by Gabriele Felice on May 27, 2019. Published on Consulpress.eu.
**Where to Export? Which Countries to Choose in Anticipating and Navigating International Crises**
Few are those who, when choosing the target country for export, take into consideration the rapidly changing geopolitical situation in Europe and beyond: Libya, Venezuela, North Korea, the direct confrontation between the United States and China, embargoes towards Iran, and Russia are just some examples of an increasingly unstable international context that inevitably affects business (whether it's , investment, or production).
The consequence, the clear deduction, is evident: before choosing a market to target, a company must not only conduct excellent commercial scouting, but must also carefully evaluate the evolving international geopolitical landscape. Disregarding this aspect (as Libya and Venezuela have taught, the latest examples in a long list), can lead to debacle and failure.
Thus, instability – as seen – has effects on export, businesses, decisions to internationalize, and especially on where and how to do it.
In light of the above, it is obvious that Italian exports have seen a peak towards the USA, one of the politically most stable places in the world and initially favored by the Trump administration, which viewed the current government positively until the "Memorandum with China".
However, even in this regard, there could be "rebus sic stantibus" consequences – if things remain as they are – and an increase in tariffs has already occurred in practice.
Statements from just over 10 days ago – such as those from Ettore Prandini, president of Coldiretti – indicating that about half (50%) of food and beverage products Made in Italy have been targeted by tariffs, confirm this. Following these, Luigi Scordamaglia, delegate councilor of Filiera Italia, points out that the United States "is our largest non-European export market, but additional tariff and non-tariff barriers to our exports would further exacerbate the phenomenon of Italian sounding in the US market, which already holds the negative record with over $23 billion of falsely labeled Made in Italy products sold".
Having said that... Is the American market in decline? No, it enjoys excellent health for a very simple reason: high-quality "Made in Italy" products are stronger and, as reported just last week, have grown by 6.7% in the first months of this year.
Another aspect concerning geopolitics is that of maritime routes and ports, which significantly influence export risks. Pertinent examples include:
- During the Gulf War (Persian Gulf), attacks on oil traffic by Saddam Hussein's air force and Iranian Silkworm missiles demonstrate how maritime traffic can be severely obstructed even without surface units.
- Cargo ships attacked by pirates along the coasts of Somalia, Kenya, or the Seychelles, resulting in crew kidnappings.
- Export costs via sea in these cases can skyrocket at best, or cargo losses can occur, with the recourse often being to insurance claims (if properly done).
It's no coincidence that China is expanding its high seas navy and seeking to establish bases and ports along Chinese export and import routes.
However, it is not the purpose of this article to provide a comprehensive analysis of the current international crises that have repercussions on exports, but rather to advise you to begin commercial scouting considering these geopolitical and strategic factors, because failure to do so will result in significant harm.
In light of the above, you should conduct a thorough comparison among the various candidate markets and make a decision.
Once the market is chosen, you must undertake all possible actions to minimize residual risks, starting with the choice of the shipping company.
The world has changed, along with the domestic and international markets, and the meticulous pursuit of a few valid customers until yesterday is not only insufficient but also entirely ineffective. This does not mean that internationalization should not be pursued, but rather that it must be done competently.
Gabriele Felice
Sono pochi coloro che nello scegliere il Paese target per l’export prendono in considerazione la situazione geopolitica che cambia ad una velocità impressionante in Europa e fuori: Libia, Venezuela, Corea del Nord, scontro frontale Stati Uniti e Cina, embargo verso l’Iran, la Russia sono solo a...
