Italy joins contested China's Belt and Road Initiative
The country signs up to China’s global infrastructure plan despite Washington and EU ireEuropost
Italy and China signed on Saturday an agreement to cooperate on Beijing’s global infrastructure plan, the Belt and Road Initiative, sealing an accord that has alarmed Italy’s US and European allies. With this Italy becomes the thirteenth EU Member State to sign a memorandum of understanding with China. Yet, it's the first Group of Seven member to do so, throwing the cohesion of the G7 into question.
The umbrella deal, making Italy formally part of the Economic Silk Road and The Initiative for a Maritime Silk Road for the 21st Century, was signed during Chinese President Xi Jinping's visit to Rome. Besides signing a memorandum of understanding (MoU), endorsing the global infrastructure building scheme, the two sides also struck a total of 29 deals, worth up to 20bn euros. They cover areas such as energy, finance, and agricultural produce, followed by the heads of big Italian gas and energy, shipbuilding and engineering firms - which will be offered entry into the Chinese market. Meanwhile, China's Communications and Construction Company will be given access to the port of Trieste to enable links to central and eastern Europe. The Chinese will also be involved in developing the port of Genoa.
"Italy and China should develop more efficient ties and build better relations," Italian Prime Minister Giuseppe Conte said at the signing ceremony, which was the highlight of a three-day trip to Italy by China's Xi.
Italy's decision to defy the recent backlash from Washington and Brussels and join the BRI comes at a time when the potential to boost Italian exports to China and pump money into crumbling Italian infrastructure is an especially alluring proposition. Especially since Italy has an onerous public debt and it fell into recession at the end of last year. But it might be not country's best decision.
Announced in 2013 as an ambitious plan to build a "belt" of overland corridors and a "road" of maritime shipping lanes spanning Asia, the Middle East, Africa and Europe, the BRI has evolved to encompass other regions, as well as digital infrastructure and even cultural exchanges. Also known as "The New Silk Road", it promises to strengthen China's trade and investment links with the rest of the world and cement its position as a major global economic power by offering participating countries inexpensive loans and credit. The scheme, however, has drawn fire from critics who accuse Beijing of engaging in so-called "debt-trap diplomacy" and potentially masking military endeavours as commercial enterprises.
In 2017, for example, Sri Lanka handed Beijing control of a strategic port after it couldn't pay off its Chinese creditors. The spectre of unsustainable debt burdens has since prompted some countries to delay, scale back and cancel BRI projects.