Italy’s exit from BRI is a big blow to Xi’s international ambitions

Italy’s exit from BRI is a big blow to Xi’s international ambitions

In March 2018, Germany, France, and Italy warned about the risk Chinese companies represented for the EU’s strategic sectors. However, the government of Italy changed views in June of the same year, and the new Prime Minister Giuseppe Conte, the leader of the right-wing populist Five Stars Movement (M5S), decided to ignore the EU concerns and push Italy closer to the People’s Republic of China.

Italy agreed to President Xi Jinping’s foreign policy flagship, the Belt and Road Initiative (BRI). The movement was a success for the Chinese efforts to penetrate Western democracies and mainly the EU. Although other EU member states have also joined the BRI, Italy was the first G7 member to do so while it is the third largest economy in Europe.

BRI aims to improve trade ties between Asia, Africa, and Europe through infrastructure investments in ports, railways, and airports. However, it is also seen as a way for Beijing to expand its influence.

Despite Prime Minister Mario Draghi, who succeeded Conte in 2021, freezing Italy’s participation in the BRI and blocking Chinese investments in strategic for the national security sectors, Italy is still part of the Initiative.

Giorgia Meloni, the new prime minister, decided to bring Italy out of the BRI because only the Chinese side drew benefits. According to the press, Meloni will announce her decision officially next October. It is a difficult decision that represents a new page not only for the relations between Italy and the PRC but also for Europe and the Western World.

Leaving BRI will allow Italy to defend its national interests – economy, security, and industry – and possibly stimulate other countries’ interest to follow Italy’s steps.

Italy and China: A long partnership

Italy’s economic cooperation deal dates back to 2004 when Prime Minister Silvio Berlusconi signed a strategic partnership agreement with China.

However, the far-right League party of Matteo Salvini promoted closer ties between Italy and the People’s Republic. When Salvini became Deputy Prime Minister and Minister of the Interior in June 2018 (Conte government), he appointed Michele Geraci as undersecretary of state for economic development. Geraci, an expert in the Chinese economy and a fervent supporter of Italy’s adherence to BRI, rapidly promoted relations between the Far East giant and Italy.

Salvini, famous for his U-turns in politics, had a second thought. As a result, he did not support Conte’s decision to push Italy into China’s grip. Also, Italian politicians have questioned the value of the BRI agreement 2019.

Last year, before being elected, Italy’s Prime Minister Giorgia Meloni expressed her opposition to Chinese expansion into Italy or Europe. She emphasised national sovereignty as a critical aspect of her pre-electoral campaign rhetoric.

Her party, Brothers of Italy (Fratelli d’Ialia, Fd’I), of neo-fascist origin, is aligned with Italy’s foreign partners in contrast with the Russophile League and M5S. Meloni recently declared that Russia has many common points with Europe while the “real danger” is China.

Such declarations met the growing Western skepticism about China’s global economic ambitions.

Also, in the Joint Statement from President Joe Biden and Prime Minister Meloni issued during her visit to the United States on July 27, 2023, the two parts commit to strengthening “bilateral and multilateral consultations on the opportunities and challenges posed by the People’s Republic of China.”

Additionally, Italy is dissatisfied with the economic outcomes of its involvement in the BRI.

The Chinese and Russian friendships of Giuseppe Conte

Former PM Conte reacted to the government’s plans to leave the BRI, saying both countries had benefits while the deal didn’t threaten Italy’s security. However, he didn’t provide convincing explanations.

Conte’s friendship with China is not the only one with a dictatorial regime. Conte has been advocating for repealing international sanctions against Russia, citing the damage it does to the Italian economy. In March 2020, during the COVID-19 pandemic, the President of Russia, Vladimir Putin, arranged for the Russian army to send military medics, special disinfection vehicles, and other medical equipment to Italy after a phone call with Italy’s Prime Minister, Conte. However, this deal was a risk to Italy’s national security.

A “privileged interlocutor” of Donald Trump in Europe, Conte critisises the EU for supporting Ukraine and consequently opposes any arm supply to Kiev.

BRI didn’t benefit Italian exports

Since May, there has been a lot of debate about whether Italy should continue to be a part of the BRI. Prime Minister Giorgia Meloni expressed her desire to hold talks with China regarding the possibility of withdrawing. If Italy doesn’t formally request to withdraw by December this year, the agreement will be automatically extended until March 2024.

Italy has the G7 presidency next year, and recasting its relationship with Beijing would appease its Western allies, who fear Chinese influence while reducing the risk of a backlash from Beijing.

“There are European nations which in recent years haven’t been part of the Belt and Road but have been able to forge more favourable relations (with China) than we have sometimes managed,” Meloni told a press conference at the end of the G20 summit of the world’s major economies in New Delhi.

In April, Economy Minister Giancarlo Giorgetti said that Italy must be increasingly cautious in its trade ties with China.

At the end of July, defence minister Guido Crosetto said Italy’s decision to join BRI was “improvised and atrocious” as Italy’s exports did not receive a significant boost, resulting in China being the sole beneficiary.

Replying to China’s assertion that both nations have seen “fruitful results” due to the BRI, Minister Crosetto told Italian newspaper Corriere della Sera that the deal increased Chinese exports to Italy without having the same effect on Italian exports to China.

“We want to continue to work closely with China, but we must also analyse exports; the Belt and Road Initiative has not produced the results we were hoping for,” Italian Foreign Minister Antonio Tajani said at an economic forum in early September.

Tajani said Italian exports to China have grown from 13 billion euros in 2019 to 16.5 billion euros in 2022. In contrast, the figures for France and Germany in 2022 were much higher at 23 billion and 107 billion euros, respectively. In addition, Chinese exports to Italy grew from 31.7 to 57.5 billion euros in the same period.


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