Italy’s decision to exit China’s Belt and Road Initiative (BRI) marks a significant shift in its approach to economic collaboration with the Asian giant. Italian Prime Minister Giorgia Meloni, in her recent comments, underscored the need to forge stronger trade and economic ties with China, signalling a departure from the less-than-fruitful BRI engagement. When Italy joined it in 2019, it was a ground-breaking move, making it the first major Western nation to embrace China’s ambitious trade and investment programme. However, the anticipated economic windfall failed to materialise, prompting the current Italian leadership to reconsider its strategy.
Ms Meloni’s acknowledgment that the BRI “has not produced the results that were expected” sums up the Italian government’s commitment to reassessing its approach to China. One key aspect highlighted in this recalibration is the emphasis on bilateral cooperation outside the BRI framework. Italy, with its rich history and economic significance, understands the need to leverage its unique position for more mutually beneficial agreements. By expressing the desire to strengthen ties with China in trade and the economy, Ms Meloni is charting a course that prioritises flexibility and pragmatism, even as she resets the terms of engagement.
The decision to withdraw from the BRI does not mean the end of collaboration between Italy and China. On the contrary, it opens the door for a more nuanced and tailored engagement that aligns with Italy’s economic interests and global partnerships. The expiry of the 2019 accord in March 2024 provides both nations with an opportunity to redefine their relationship based on a more strategic and reciprocal foundation. Interestingly, the comparison drawn with fellow G7 nations, which have closer ties with China despite not being part of the BRI, explains the decision taken by Italy. This stance reflects a mature understanding of diplomacy, acknowledging that collaboration can take various forms, with or without the BRI. The economic data presented paints a clear picture of the BRI’s impact on Italy’s trade dynamics. While Italian exports to China increased, the lion’s share of economic benefits flowed to Chinese firms. Italy’s trade deficit with China raises questions about the sustainability and fairness of the BRI model.
Ms Meloni’s government seems keen on rectifying this imbalance by seeking reciprocal agreements that promote Italian economic interests. Italy’s upcoming presidency of the G7 in 2024 adds another layer of significance to this recalibration. As a key global player, Italy’s evolving approach to China will likely influence discussions within the G7 and beyond. The nation’s commitment to maintaining strategic ties, Italian Foreign Minister Antonio Tajani’s recent Chinese trip and the planned visit of President Sergio Mattarella to Beijing, underscores the importance Italy places on fostering constructive relations. From China’s perspective, though, the repudiation of the BRI template is a definite setback. Beijing’s other BRI partners will doubtless view these developments closely.