CR
Country Report: Italy CR Country Report: Italy
ITALY’S TISSUE BUSINESS BECOMES MORE EXPORT-DRIVEN WITH 50% OF EXPORTS GOING TO NEW MARKETS Even as per capita GDP has vastly increased over the last 14 years, low domestic demand growth has pushed the industry to seek new trade abroad backed by expansion and replacement strategy across manufacturing.
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taly plays two different yet highly significant roles in the global tissue business. The first is as a producer for domestic and export tissue production, the role in which we will explore in this report, and the other as an innovator, designer, and manufacturer of tissue production equipment. Italian engineering and design skills are sought out globally for tissue machines and converting equipment supplies — however, this report does not cover that equipment business. Domestic demand for tissue products depends on economic and cultural factors. Italy’s gross domestic product and population trends are shown in Figure 1. GDP is expressed as purchasing power parity per capita and illustrated as the blue line on the chart. Per capita GDP has vastly increased over the last 14 years and is expected to continue to support consumer purchases for tissue products. The population is shown on
the chart as the bars representing millions of people. Italy has had a relatively flat to decreasing population over the trend shown in Figure 1. An alternative data point from the world factbook suggests that Italy had an estimated 0.09% population growth in 2021. The ratio of births to deaths is less than one, meaning that any population growth is dependent on migration. Inflation and unemployment are two economic factors that limit domestic growth in tissue demand. Figure 2 shows the inflation trend moderating from two high peaks to a lower range. However, inflation appears to be increasing again due to the global supply chain crunch. The unemployment rate is represented in Figure 2 as the bars and shows a build-up to peak unemployment in 2014 before gradually decreasing until its next increase in 2021. The unemployment rate is relatively high yet consistent with similar countries in Europe.
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Bruce Janda Senior Consultant, Fisher International Overall, the economic conditions are positive to support continued growth in tissue demand per person and any change that would occur in the market due to population would be minimal and insignificant. Italy's domestic tissue demand is partially met by imports, as shown in Figure 3. The major suppliers of Italy's tissue imports are France, Germany, Poland, Spain, Sweden, and Switzerland. The "all other" category sitting at the top of the bars is 30% of the total in 2021. These globally sourced imports represent 4% or less from any one country not named in the chart. Italy's tissue exports are shown in Figure 4, which are trending upward approximately ten times compared to the volume of Italian imports. This shows that Italy is a substantial tissue producer for exports. Italy's main tissue customers include France, Germany, Greece, Hungary, Poland, Spain, Switzerland, and the United Kingdom. Many of these are the same countries that also supply tissue to Italy. The overall trend of exports has been growing through the periods shown, and the "all other" category has been increasing as the aforementioned countries’ business is shrinking. This now represents 50% of Italy's export business, but individual countries comprise less than 4% of the total. Italy's tissue business has started to become more export-driven with a more diverse customer base. Tissue World Magazine | January/February 2022
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