China lays down a marker in Europe
Over the weekend, Italy became the first member of the Group of Seven major developed economies to formally join China’s ambitious Belt and Road Initiative, a sprawling Chinese-led project that aims to build a “new Silk Road” of railways, ports and other infrastructure projects linking China to the West and myriad nations in between. The initiative, backed by billions of dollars in funds from Chinese state-run companies, is steadily reshaping global geopolitics — and steadily unnerving policymakers in Western capitals.
“Italy, whose economy has sagged for decades, says the potential economic benefits are too great to pass up,” wrote The Washington Post’s Rome bureau chief, Chico Harlan. “But in pursuing the Belt and Road deal, Italy’s populist government is breaking ranks with the most powerful countries of the West, defying the wishes of the Trump administration, and highlighting the unsettled debate within Europe on how to deal with China’s globally expanding ambitions.”
Italian Prime Minister Giuseppe Conte, who leads a ruling coalition of two anti-establishment parties in Rome, welcomed the prospect of “a better relationship” with Chinese President Xi Jinping and his government. After being feted in the Italian capital, Xi jetted off to the Sicilian port city of Palermo, one of the potential sites for Chinese investment in the Mediterranean alongside the Italian cities of Genoa and Trieste.
Over the past decade, Chinese companies acquired stakes in 13 major European ports, which represent about 10 percent of the continent’s total shipping container capacity. The Greek port of Piraeus — the venerable entrepôt connected to Athens so steeped in antiquity that it’s mentioned in the first line of Plato’s “Republic” — is now largely controlled by a major Chinese shipping company and seen as the “dragon head” of Beijing’s further expansion into Europe.
Now, some officials are sensing a special opportunity for Italy. “We export a lot less than we import, compared with our European friends,” said Licia Mattioli, vice president for international affairs at Confindustria, the main Italian industry association, to The Post. “So we think there is a huge potential that we can exploit.”
There’s even talk of Italian ports soon rivaling northern European competitors in Hamburg and Rotterdam. Consider the ambitions of Zeno D’Agostino, the president of the Trieste port authority, who sees the Chinese arrival in grand, historic terms. “Fundamentally, what’s happening is that the port of Trieste is returning to the logistical role for Europe that it had for the old Austro-Hungarian empire,” D’Agostino told the New York Times, referring to the Adriatic city’s past as a major port ruled from Vienna.
But elsewhere in Europe, brows are getting all the more furrowed. After his stay in Italy, Xi headed to Monaco and then France for a likely testy encounter with President Emmanuel Macron, who had recently voiced concerns about “European naivete” over Chinese intentions and warned of the risk of European nations becoming “vassal states.” In other parts of the world, some Chinese-brokered projects have drawn significant criticism for turning into “debt traps” that enfeeble smaller countries and make them all the more beholden to Beijing.
Italian officials argue that they are better positioned to handle Chinese investment without surrendering sovereignty than more vulnerable countries to the east. Italian laws will prevent Chinese companies from wholly taking over their ports. A commentary in China’s state-run Xinhua news service shrugged off Western concerns and cast the new agreement with Italy as proof of the BRI’s ability to benefit local populations and serve as a “win-win” for all parties.
“Some major Western powers on both sides of the Atlantic rushed to raise a red flag on the BRI’s alleged national security and financial risks, distort the initiative as China’s self-serving geo-political tool, and accuse Beijing of trying to expand its spheres of influence into the heartland of the European continent,” Xinhua noted. “For them, the Cold War seems to be still raging on.”
The main culprit here, in Beijing’s eyes, is the United States. The Trump administration has been outspoken in its criticism of China’s overseas infrastructure projects and is separately trying to convince its European allies to resist the inroads of major Chinese telecoms firm Huawei, which is on the front lines of a global tussle over the next generation of wireless technology. In a striking rebuke of its NATO ally, the White House National Security Council tweeted its dismay with Rome lending “legitimacy to China’s predatory approach."
But experts argue that the White House has undermined itself with its occasionally hostile trade policies toward countries in the European Union, including a decision to label certain European businesses as “national security” threats to justify protectionist tariffs. Some European officials believe their countries are capable of warding against the threat of both Chinese cyberespionage and mercantilist coercion. At the same time, they are also skeptical of American demands to ban Huawei or to resist categorically any involvement in the BRI, given the Trump administration’s nationalist agenda.
“If the best the U.S. can do in these situations is threaten to impose tariffs or other economic penalties, it is indicative of the kind of sclerotic self-righteousness that often appears when global superpowers either take power for granted or fail to maintain their relative advantages,” wrote Jacob Shapiro, an analyst at Geopolitical Futures. “Six years after China announced the Belt and Road Initiative, the U.S. response is to send angry tweets. That is far more of a boon to Chinese strategy than any [investment agreements] could ever be.”
While Italians may be years away from seeing any meaningful dividend from this new partnership with China, Luigi Di Maio, one of the government’s deputy prime ministers, cheekily pointed to President Trump as an inspiration for current policy in Rome.
“Like someone in the United States said, ‘America first,’ ” Di Maio said over the weekend, “I continue to repeat ‘Italy first’ in commercial relations.”