Rome workshop examines industrial subsidies and trade diversion
Banca d'Italia hosted a research workshop in Rome on September 28, 2026, gathering economists from major central banks and international institutions to examine the macroeconomic fallout of China's industrial policy and trade diversion.
From industrial policy to export redirection
The workshop at the Carlo Azeglio Ciampi Conference Center brought together researchers from the European Central Bank, the International Monetary Fund, the Federal Reserve, and euro area national central banks.
Sessions focused on the drivers of modern technology competition, evaluating how strategic subsidies and tariffs influence innovation.
Researchers analyzed the reconfiguration of supply chains and tariff pass-through during the U.S.–China trade conflict, alongside the micro and macro mechanisms governing Chinese export redirection.
Key presentations investigated the specific transmission of these trade dynamics to German exporters and broader European industrial output.
Macroeconomic imbalances in the spotlight
Keynote speaker Huang Yiping of Peking University addressed China's internal economic imbalances and their worldwide implications.
Discussions chaired by Banca d'Italia and ECB officials emphasized model-based assessments of trade shocks, highlighting how redirected export flows alter competitive conditions in third markets.
Contributions from the Federal Reserve Board and Banque de France detailed how oligopolistic market structures shape tariff transmission across global production networks.
High on diagnosis, short on remedies
The workshop gathers vital research on a structural shock confronting European industry.
Yet analyzing export diversion yields little comfort while policymakers disagree on trade defenses.
Analytical models cannot substitute for a cohesive strategy to counter subsidized competition.