President Xi Jinaping of China in talks with the Italian Prime Minister to revive the Silk Road

Italy’s Prime Minister, Giuseppe Conte, welcomed the Chinese President, Xi Jinaping and his wife in Rome at the start of the President’s European tour.  The visit to Italy is primarily for the two leaders to discuss the ambitious Belt and Road project which China envisions, involving a huge infrastructure undertaking which is planned, following in the footsteps of Marco Polo by reviving the Silk Road and creating an overland and maritime superhighway linking Europe with China.  Italy is the first major democratic country to align itself with the project.

There are divided opinions as to the merit of this venture with some within the government believing the association with China will weaken the ties with the rest of Europe and the United States as well as giving China the opportunity of being able to influence Europe.  Giuseppe Conte has agreed to sign a memorandum of understanding with China during the course of the visit; he believes that the economic opportunities with China outweigh these objections.  Michele Geraci, Italy’s undersecretary for economic development has pointed out that Italy is not so far forward in trading with China as some other European countries and Italy would have to increase its exports to China by seven billion euros to be level with France.  Also, there are disproportionate trading figures between Italy and China as Italy imports €60 billion In goods from China, as against the €13 billion exports of Italian goods to China.   There is a keen appetite in Italy to narrow the gap between the two figures by selling more Italian luxury goods to China.

There is also an initiative to leverage the two countries’ cultural heritage.  Ahead of the visit President Xi Jinaping drew attention to the fact that China and Italy are the two countries with the largest number of UNESCO world heritage sites, he pointed out the potential for shared art exhibitions and cultural television and film projects.   

At the moment Italy is alone in signing up to the Belt and Road project.  Other European countries are not convinced of the merits of the project.  There are also grave reservations about the level of transparency and the lack of standards with regard to financing.  These misgivings have not daunted Mr. Mantarella, Italy’s President, who apparently regards China “not only as an economic partner of prime importance but also as a driver of global trade and a market for Italian technology and expertise in areas like environmental protection, food security, health services and machinery”.   A view echoed the Chinese Vice Foreign Minister Wang Chao who commented: “the Belt and Road deal would be beneficial for both countries’ economic development and trade”.

Italy’s current economic and political situation is, to some degree, vulnerable and expanding an existing market could be of great assistance.  European concerns are not entirely unfounded and there is a danger that China will weight the final deal heavily in their own favour and there is also a risk that the Italian ports may come under threat in the same way that the Greek port of Piraeus has fallen prey to COSCO.