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Why Italy Is Leaving the Belt and Road Initiative

Updated: Aug 13, 2023

Italy's decision to participate in China's Belt and Road Initiative (BRI) in 2019 stunned the international community. The decision to support this significant infrastructure project as the first G7 nation was a turning point in the dynamics of global relations. Italy's position on the BRI, however, appears to be changing significantly as its five-year memorandum of agreement is slated to be extended in March 2024, indicating both economic disappointment and a larger strategic recalibration towards China.

Italian interest in the BRI was initially sparked by a combination of economic and geopolitical considerations. Italy was looking for ways to increase access to China's sizable market and find new business opportunities after suffering through several recessions quickly. Italy, which felt a bit left out in Europe and harboured misgivings about the European Union, regarded China as a potential partner to meet its investment demands. In an effort to attract Chinese interest and investments, the country used its political influence to join with the BRI.

On the other hand, Chinese President Xi Jinping has his own motivations for courting Italy. Due to China's historical importance at the end of the Silk Road, Xi was able to match the success and worldwide effect of his most important foreign policy project. Furthermore, Italy's sizable Chinese population and pre-existing trade ties offered China fertile ground to take root in Europe and maybe rip a hole in the EU. However, the BRI experience in Italy has not gone as planned.

Although the country signed a number of institutional agreements with China as part of the effort, these accords did not significantly alter the course of Italy-China economic relations. and Chinese exports to Italy increased dramatically and Italian exports to China only slightly increased, the promised economic gains were never realised. Furthermore, Chinese investments in other European countries outpaced those in Italy, even after the latter's BRI participation.

Italy is rethinking its participation in the BRI due to its disappointment with the economic results. Italy's decision to join the BRI has been officially referred to as a "big mistake" by Prime Minister Giorgia Meloni, who has stated her intention to reverse the decision. Italy has been forced to reconsider its strategic stance due to the lack of concrete benefits and rising transatlantic agreement over the dangers posed by China.

This strategic re-evaluation is a result of China's changing image in Europe. China's forceful behaviour and its backing of Russia in the Ukraine war have caused European nations to re-evaluate their relations with China, which is now seen more as an adversary than a partner. It is currently believed that China's goal to restructure the international order is demonstrated by the BRI, which was originally perceived as a vehicle for economic cooperation.

The BRI's prospective termination by Italy has wider geopolitical ramifications. Reduced economic reliance on China, closer ties with the US, and upholding peace and stability in places like Taiwan are the top priorities for European nations. Other nations have reconsidered their participation in the BRI due to its shifting dynamics, and Italy's withdrawal from the project may be indicative of a wider trend.

Italy's decision to withdraw from the BRI is less about achieving economic goals and more about adjusting to the changing global environment as geopolitics once again takes centre stage and China's intentions are subject to increased scrutiny. This change emphasises how complicated international relations are and how important it is for countries to match their strategic objectives with evolving conditions.


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