(Reuters) - Italy signed a preliminary accord with China on Saturday that makes it the first country of the Group of Seven industrialized nation to join the Chinese Belt and Road infrastructure project.

Italian Prime Minister Giuseppe Conte and Chinese President Xi Jinping shake hands after signing trade agreements at Villa Madama in Rome, Italy March 23, 2019. REUTERS/Yara Nardi

Around 30 parallel deals were signed on the sidelines of the visit to Rome by Chinese President Xi Jinping, including 10 with Italian companies and others with ministries and public bodies.

Italian Deputy Prime Minister Luigi Di Maio said the deals were worth an initial 2.5 billion euros ($2.8 billion) but had a potential value of 20 billion.

Here are details of some of the accords.

CDP, BANK OF CHINA

Italy’s state lender Cassa Depositi e Prestiti (CDP) signed an agreement with Bank of China to let it sell “Panda” bonds - debt sold by foreign entities to investors in mainland China.

CDP said it will issue bonds worth 5 billion renminbi ($744.5 million). CDP and Bank of China will also co-finance Italian companies for 4 billion renminbi. A CDP official told Reuters on Friday that the first tranche of Panda bonds will be issued in the coming weeks.

CDP, SNAM

CDP and Italian gas company Snam have signed a memorandum of understanding with the Chinese Silk Road fund (SRF) for cooperation on international investments in China and in the about 120 countries that have already signed up for the Belt and Road Initiative (BRI).

Snam and SRF said they will consider possible cooperation in the natural gas sector — pipelines, storage facilities, LNG infrastructure and biomethane plants.

DANIELI

Italian metals company Danieli has signed a deal to build part of a steel plant in China that will then be transferred to Azerbaijan.

TRIESTE AND GENOA PORTS China Communications Construction Company (CCCC) has signed two cooperation agreements with the authorities of Trieste’s port and with the commissioner supervising the reconstruction of the bridge of Genoa that collapsed last year.

ANSALDO ENERGIA

Ansaldo Energia said it signed a deal with China United Gas Turbine Company (UGTC) for technology cooperation in the field of heavy duty gas turbines.

Ansaldo Energia has also been awarded a contract worth approximately 25 million euros to supply a AE94.2K gas turbine and syngas compressor train for Bengang combined cycle power plant, located in Benxi in the northeast China.

SUNING

China’s e-commerce group Suning, top shareholder of Italian Serie A soccer team Inter Milan, announced a deal with the Italian Trade Agency to boost Made-in-Italy exports to China.

INTESA SANPAOLO

Intesa Sanpaolo has signed a MoU with the Chinese city of Qingdao to develop wealth management services for local clients through a wholly-owned company called Yi Tsai. Intesa aimed to sell its own financial products in Qingdao in the near future, Intesa CEO Carlo Messina said.

ENI

Italian energy giant Eni has signed a MoU with Bank of China to secure a credit line.

FERROVIE DELLO STATO, AEROPORTI DI ROMA

Italy’s railways group Ferrovie dello Stato, Atlantia’s airport operator Aeroporti di Roma and the museums of sports car maker Ferrari have signed a commercial deal with China’s biggest online travel agency Ctrip to develop Chinese tourism in Italy.

(This story fixes spelling error for the Chinese city of Qingdao for item on Intesa Sanpaolo.)</s>March 23 (UPI) -- Italy became the first G-7 country to sign on to China's Belt and Road initiative on Saturday, a deal experts say is meant to expand the country's global ambitions into Europe.

Chinese president Xi Jinping visited Italian government officials in Rome on Friday. Italian Prime Minister Giuseppe Conte said Saturday that his country will build a "more effective relationship" with China in connection with the joining the project, the Washington Post reported.

China's Belt and Road Initiative is a vast multi-continent project of highways, rail lines and energy pipelines connecting China economically to Europe. The Italian deal would open the door for Chinese infrastructure investment in Italian ports, while helping Beijing gain influence and trade goods in Western Europe.

"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. "So we think there is a huge potential that we can exploit."

Some European Union leaders cautioned Italy about its bilateral agreement with China.

"We should not be naïve," Dutch Prime Minister Mark Rutte, told reporters Friday about the Chinese-Italian agreement. "You have to take into account the possibility that China, through these policies, is also pursuing its some of its national interests. It can present a problem given the content of those agreements."

Some experts expressed concern because Italy did not discuss geopolitical concerns about the Chinese project with the EU and United States allies.

"Everyone is somehow involved in the project but no other G7 country has signed an MoU of this kind," Renzo Cavalieri, a professor of law of east Asian countries at Ca' Foscari University of Venice, told the Guardian.

"What Italy has done, in quite a disordered way, is take a step ahead to create something which, so far, is not that strong in content but is quite important symbolically," he added.</s>ROME (AP) – Italy signed a memorandum of understanding with China on Saturday supporting Beijing’s “Belt and Road” initiative, which aims to weave a network of ports, bridges and power plants linking China with Africa, Europe and beyond.

With the move, Italy becomes the first member of the Group of Seven major economies, which includes the United States, to join the Belt and Road program, following Portugal’s embrace of the initiative in December.

Italian Premier Giuseppe Conte and Chinese President Xi Jinping attended a ceremony in Rome where 29 separate protocols of the memorandum were signed by both governments in front of the flags of China, Italy and the European Union.

Luigi di Maio, the Italian minister of economic development, told reporters afterward that his country’s goal is to increase exports to China in order to correct trade imbalances and boost Italian businesses and the country’s troubled economy. He said the value of the individual deals signed on Saturday amounts to 2.5 billion euros ($2.8 billion), with the potential to grow to 20 billion euros ($22.6 billion)

“Our goal with these accords is to start to rebalance an imbalance for which there is a lot of ‘Made in China’ coming to Italy and too little ‘Made in Italy’ that goes to China,” Di Maio said.

He said Italy now expects “a substantial and gradual increase of exports and we hope that in the next years we can balance out the trade imbalances.”

Italy’s move appears to also be driven by hopes that Chinese investment in Italy’s ports might help revive the country’s traditional role as a key link in trade between the East and West.

The signed accords are wide-ranging and include cooperation between banks, between a Chinese construction company and Italian ports, and the export of Italian fruit to China. The deals also foresee cooperation in the spheres of science and technology and between media outlets, as well as the return by Italy of hundreds of Chinese cultural treasures.

The signing ceremony took place at the Villa Madama, a Renaissance villa designed by Raphael, where Xi was greeted with full honours on the second day of his two-day visit to Italy. He then travelled to Sicily, where officials hope to attract more Chinese tourism.

Italy’s involvement in the Belt and Road program gives China a crucial inroad into Western Europe and a symbolic boost in its economic tug-of-war with Washington, where President Donald Trump is challenging China over trade and other issues.

The EU, however, is worried about unfair competition from Chinese companies, which are controlled by the Chinese government and benefit from the state’s financial backing. EU leaders in Brussels are preparing a strategy to counter the growing influence of China, which they describe as a “systemic rival.”

Some Italian government officials were critical of the deals, worried that Italy might be ceding national sovereignty in key strategic areas to Beijing. In a sign of opposition, Matteo Salvini, the deputy prime minister and interior minister, stayed away from the official ceremonies with the Chinese delegation.

Di Maio stressed that Italy remains firmly rooted in its alliance with the United States, NATO and its European partners, but said Italy must also look out for its own economic interests.

“Like someone in the United States said ‘America first,’ I continue to repeat: ‘Italy first’ in commercial relations,” Di Maio said.

In response to concerns that the memorandum could open the way to colonization by China, Di Maio countered it would instead help goods manufactured in Italy “to colonize the world.”

“That is a good colonialization,” he said.

The Belt and Road project has so far seen investments totalling more than a trillion dollars since its launch more than five years ago, and China says some 150 countries have signed agreements related to the project.

Beijing has marketed the initiative as a way to give some of the world’s neediest countries a leg up, helping them gain access to more trade and investment. But it also helps Chinese companies tap new markets for their products while helping Beijing amass greater global influence.

Some governments including the U.S., Japan and India worry that Beijing is trying to build a China-centered sphere of influence that undermines their own sway, pulling developing nations into infrastructure “debt traps” that would give China ever-more control over their territories and economies. Some say the proposed improvements are too expensive for the impoverished countries.

China’s official position is that Belt and Road is solely an economic initiative with no political motives. Xi said last year that even as China moves closer to the centre of the world stage, it will never seek hegemony.</s>Resisting pressure from Washington and Brussels, Italy on Saturday became the first G7 country to join China's controversial Belt and Road Initiative (BRI).

Italy's Prime Minister Giuseppe Conte, signed a memorandum of understanding (MoU) with Chinese President Xi Jinping in Rome, endorsing the global infrastructure building scheme.

Conte and Xi shook hands after 29 separate sections of the memorandum were signed by members of both governments.

The MoU is non-binding. But by opening the door to greater Sino-Italian cooperation, it threatens to deepen rifts between Rome and its traditional allies and within Italy's fragmented coalition government.

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.

BRI projects are financed by Chinese state-owned enterprises that offer participating countries inexpensive loans and credit. Analysts at Morgan Stanley predict China's investments in BRI countries could reach $1.3 trillion by 2027.

The scheme 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, 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.

Italy's decision to defy the recent backlash 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.

Italy has an onerous public debt and it fell into recession at the end of last year.

"Italy needs investment and resources and China has those to provide," said Erik Jones, professor of European studies and international political economy at Johns Hopkins University's Bologna-based School of Advanced International Studies.

"Italy also needs to underpin and strengthen its business ties with China [and] this agreement will help there," he said.

Italy is the thirteenth European Union country to sign a memorandum of understanding with China. But it is the first G7 member to do so, throwing the cohesion of the G7 into question.

The landmark move is also a bold statement to Brussels, which engaged in an acrimonious budget battle with Rome last year that forced Italy to pare back its spending plans.

Brussels and Rome have also butted heads over immigration.

"Italy has issues where it is not happy with the EU and the EU is not happy with it, and the only way out of this conundrum is for [Italy] to expand their trade," Einar Tangen, a political and economic affairs commentator, told Al Jazeera.

"Being part of the Belt and Road Initiative would give them a little bit more independence and obviously offer more trade," he said.

Brussels has held a tougher position against the BRI since reports first surfaced of Italy's plans to join the scheme.

The European Commission and the EU's diplomatic arm released a paper last week that branded China a "systemic rival" and threatened to tighten regulations on Chinese investment in Europe.

The paper also included a pledge that EU member states would push for a common approach to 5G security risks in response to concerns raised by the US over Chinese tech giant Huawei.

Some analysts also see Italy's embrace of the BRI as a symbolic gesture of independence ahead of the European Parliament elections this May.

"This agreement is something the government can hold up as an accomplishment," said Jones. "That is particularly relevant for Prime Minister Giuseppe Conte, who tends to have to mediate between the coalition partners more than he is able to take credit for new initiatives."

But joining the BRI could further exacerbate tensions between the two main parties in Italy's coalition government.

Conte's anti-establishment Five Star Movement has championed stronger ties with China, while its main coalition partner, the Eurosceptic, far-right League, is seeking to maintain good relations with the US, which is embroiled in an ongoing trade war with Beijing.

The US and China are also in an escalating dispute over Huawei, whose products the US claims pose a risk to national security.

When reports of Italy's intentions emerged in early March, the White House National Security Council tweeted: "Endorsing BRI lends legitimacy to China's predatory approach to investment and will bring no benefits to the Italian people."

On Tuesday, Conte appeared to try and assuage Washington, telling Italy's parliament that any commercial and economic deals with China "do not remotely put into doubt our Euro-Atlantic alliance".</s>German Foreign Minister Heiko Maas has criticized Italy's decision over the weekend to join China's Belt and Road Initiative, while the EU's budget commissioner suggested the bloc could veto the foreign takeover of critical infrastructure in Europe.

In a world dominated by major global powers like China, Russia and the United States, "we can only survive if we are united" as the European Union, Maas said in an interview published Sunday in the Welt am Sonntag newspaper.

Maas warned that "China is not a liberal democracy." Countries that believe they can do "clever business with the Chinese will wonder when they suddenly wake up in dependency." Lucrative offers in the short term will soon leave a bitter aftertaste, he added.

Italy officially joined China's Belt and Road Initiative on Saturday, becoming the first G7 nation to do so. The Chinese initiative, also known as the New Silk Road, aims to create new rail, road, port and energy links between China, Europe and Africa.

Dozens of countries, including EU members Greece, Poland and Hungary, have already joined despite US and EU objections.

European Commissioner Guenter Oettinger, a German national, in a separate interview suggested the EU should have the right to block China from taking control of critical European infrastructure.

"I view with concern that, in Italy and other European countries, strategically important infrastructure projects - power grids, high-speed train lines or ports - are no longer in European hands but in Chinese hands," he told media group Funke Mediengruppe.

Oettinger, the EU's budget commissioner, added that he believed member states were not taking their national and European interests into account. "That is why we should consider a European veto right or a European right of approval, carried out by the commission," he said.</s>Despite criticisms, Beijing has been steadily gathering support for its “Belt and Road” initiative, which aims to weave a network of ports, bridges and power plants linking China with Africa, Europe and beyond. Italian Premier Giuseppe Conte has pledged to sign a memorandum of understanding this week on supporting the initiative during a visit by Chinese President Xi Jinping, who has made the initiative a signature policy of his administration.

Italy’s involvement would give China a crucial inroad into western Europe and a symbolic boost in its economic tug-of-war with the United States. Italy would be the first member of the G-7, a group of seven major economies that includes the United States, to join Belt and Road, following Portugal’s embrace of the initiative in December.

Also read| For EU, Brexit has trashed Theresa May’s ‘strong and stable’ image

It appears to be driven partly by hopes that Chinese investment in Italy’s ports might help revive the country’s traditional role as a key link in trade between the East and West. The Belt and Road program is a loosely defined umbrella for predominantly China-financed — and usually China-built — projects in more than 60 countries from the South Pacific through Asia to Africa and Europe.

As President Donald Trump squares off with China over trade and other issues, gaining Italy’s support is a coup for Beijing. “It’s important for the Xi administration to show that you have Portugal and Italy, two well-known countries in western Europe breaking ranks with the western alliance in BRI,” said Willy Lam, an adjunct professor of China studies at the Chinese University of Hong Kong. China says some 150 countries have signed Belt and Road related agreements since the program’s launch more than five years ago.

A major conference is planned next month in Beijing, marking further expansion of the initiative. Beijing has marketed the initiative as a way to give some of the world’s neediest countries a leg up, helping them gain access to more trade and investment. But it also helps Chinese companies tap new markets for their products while, inevitably, helping Beijing amass greater global influence.

Some governments including the United States, Japan and India worry that Beijing is trying to build a China-centered sphere of influence that would undermine their own sway, pulling developing nations into so-called “debt traps,” that would give China ever-more control over their territories and economies.

China already has made inroads in Eastern Europe through investments in railways, ports and steel mills. That’s stirred fears of a growing divide within the 28-member European Union between its wealthier and poorer members. Some also worry Chinese-led projects might undercut the bloc’s standards on transparency.

As the U.S. takes on long-standing complaints of Chinese intellectual property theft and unfair trade practices, a Chinese win in Italy could boost Beijing’s arguments that it is ultimately a force for good in the global economy. China’s official position is that Belt and Road is solely an economic initiative with no political motives. Xi said in a speech late last year that even as China moves closer to the center of the world stage, it will never seek hegemony.

“The Belt and Road Initiative in nature is an economic strategy,” said Chu Yin, a researcher at the Center for China and Globalization, a think tank in Beijing affiliated with the government and with the ruling Communist Party. “China has no intention to become a global hegemon and nor does China have such an ability,” he said.

Launched in 2013, the initiative is at heart a business venture, not aid. China wants to attract non-Chinese investors but that has happened only on a few of the hundreds of projects, which range from oil drilling in Siberia to construction of ports in Southeast Asia, railways in Eastern Europe and power plants in the Middle East.

The initiative has run into some roadblocks in the past year, as the Chinese economy cooled and the US and others accused Beijing of saddling developing countries with too much debt. Some governments including Thailand, Tanzania, Sri Lanka and Nepal have scrapped, scaled back or renegotiated projects amid complaints that they are too costly and give too little work to local contractors Last year, Malaysian Prime Minister Mahathir Mohamad cancelled projects including a USD 20 billion railway he said his country cannot afford. And in 2017, December, Sri Lanka sold control of its port of Hambantota to a Chinese state-owned company after falling behind in repaying USD 1.5 billion in loans from Beijing.</s>ROME (Reuters) - Italy endorsed China’s “Belt and Road” infrastructure project on Saturday, the first Group of Seven industrialized power to do so, as Rome brushed off worries among its Western allies in a bid to revive the flagging Italian economy.

The signing ceremony was the highlight of a three-day trip to Italy by Chinese President Xi Jinping, which has boosted ties between the two nations at a time when the United States is locked in a trade war with China.

The Belt and Road Initiative (BRI) is aimed at bolstering Beijing’s economic and political reach. However, critics say it is a Trojan Horse that will let China get control of sensitive technologies and critical infrastructure.

Italy’s populist government, anxious to encourage exports and investment as the economy suffers its third recession in a decade, has played down such worries and gave Xi a red-carpet welcome normally reserved for its closest allies.

Chinese and Italian firms signed 10 additional deals, including in the energy, steel and gas pipeline sectors.

Full details of the contracts were not immediately revealed, but a government source said they could potentially be worth up to 20 billion euros ($22.62 billion).

Italian media put the value at around 5 billion euros.

Deputy Prime Minister Luigi Di Maio, who also serves as industry minister, signed the Belt and Road memorandum of understanding with China’s He Lifeng, chairman of the National Development and Reform Commission.

They were flanked by Xi and Italian Prime Minister Giuseppe Conte. The Chinese president is due to fly to the Sicilian city Palermo later on Saturday for a private visit before heading to Monte Carlo and then France on Sunday.</s>Italy endorsed China’s ambitious “Belt and Road” infrastructure plan on Saturday, becoming the first major Western power to back the initiative to help revive the struggling Italian economy.

Saturday’s signing ceremony was the highlight of a three-day trip to Italy by Chinese President Xi Jinping, with the two nations boosting their ties at a time when the United States is locked in a trade war with China.

The rapprochement has angered Washington and alarmed some European Union allies, who fear it could see Beijing gain access to sensitive technologies and critical transport hubs.

Deputy Prime Minister Luigi Di Maio played down such concerns, telling reporters that although Rome remained fully committed to its Western partners, it had to put Italy first when it came to commercial ties.

“This is a very important day for us, a day when Made-in-Italy has won, Italy has won and Italian companies have won,” said Di Maio, who signed the memorandum of understanding on behalf of the Italian government in a Renaissance villa.

Taking advantage of Xi’s visit, Italian firms inked deals with Chinese counterparts worth an initial 2.5 billion euros ($2.8 billion). Di Maio said these contracts had a potential, future value of 20 billion euros.

The Belt and Road Initiative (BRI) lies at the heart of China’s foreign policy strategy and was incorporated into the ruling Communist Party constitution in 2017, reflecting Xi’s desire for his country to take a global leadership role.

The United States worries that it is designed to strengthen China’s military influence and could be used to spread technologies capable of spying on Western interests.</s>Rome: Italy endorsed China’s ambitious “Belt and Road” infrastructure plan on Saturday, becoming the first major Western power to back the initiative to help revive the struggling Italian economy.

Saturday’s signing ceremony was the highlight of a three-day trip to Italy by Chinese President Xi Jinping, with the two nations boosting their ties at a time when the United States is locked in a trade war with China.

The rapprochement has angered Washington and alarmed some European Union allies, who fear it could see Beijing gain access to sensitive technologies and critical transport hubs.

Deputy Prime Minister Luigi Di Maio played down such concerns, telling reporters that although Rome remained fully committed to its Western partners, it had to put Italy first when it came to commercial ties.

“This is a very important day for us, a day when Made-in-Italy has won, Italy has won and Italian companies have won,” said Di Maio, who signed the memorandum of understanding on behalf of the Italian government in a Renaissance villa.

Taking advantage of Xi’s visit, Italian firms inked deals with Chinese counterparts worth an initial 2.5 billion euros ($2.8 billion). Di Maio said these contracts had a potential, future value of 20 billion euros.

The Belt and Road Initiative (BRI) lies at the heart of China’s foreign policy strategy and was incorporated into the ruling Communist Party constitution in 2017, reflecting Xi’s desire for his country to take a global leadership role.

The United States worries that it is designed to strengthen China’s military influence and could be used to spread technologies capable of spying on Western interests.

Italy’s populist government, anxious to lift the economy out of its third recession in a decade, dismissed calls from Washington to shun the BRI and gave Xi the sort of red-carpet welcome normally reserved for its closest allies.

Some EU leaders also cautioned Italy this week against rushing into the arms of China, with French President Emmanuel Macron saying on Friday that relations with Beijing must not be based primarily on trade.

There was not even universal backing for the BRI agreement within Italy’s ruling coalition, with Deputy Prime Minister Matteo Salvini, who heads the far-right League, warning against the risk of China “colonialising” Italian markets.

Salvini did not meet Xi and declined to attend a state dinner held in honour of the visiting leader on Friday.

Di Maio, who leads the 5-Star Movement, says Italy is merely playing catch up, pointing to the fact that it exports significantly less to China than either Germany or France.

Italy registered a trade deficit with China of 17.6 billion euros last year and Di Maio said the aim was to eliminate the deficit as soon as possible.

After talks with Italian Prime Minister Giuseppe Conte and Di Maio in the morning, Xi flew to the Sicilian city Palermo for a private visit on Saturday afternoon.

He is due to head to Monte Carlo on Sunday before finishing his brief tour of Europe in France, where he is due to hold talks with Macron and German Chancellor Angela Merkel.

Firstpost is now on WhatsApp. For the latest analysis, commentary and news updates, sign up for our WhatsApp services. Just go to Firstpost.com/Whatsapp and hit the Subscribe button.</s>Italy is projected to be the first G7 nation to officially endorse China’s Belt and Road Initiative (BRI). And that’s raising the ire of both the European Union and the United States.

Having re-entered a recession at the end of 2018, the eurozone’s third largest economy is welcoming China’s President Xi Jinping for a three-day state visit. While there, Italy is expected to sign a memorandum of understanding – making it the 124th nation to sign up for this geographically expansive infrastructure and investment strategy.

Proposed in 2013, China’s BRI is a transcontinental project that focuses on infrastructure investment and projects that promote regional cooperation, development and connectivity. It offers participants a means to secure their trade, energy and transport network. China presents it as a win-win relationship aimed at mutual growth. But there are suspicions regarding China’s motivations – it’s seen as a way for China to embed its global influence – and it could make participants dependent on China. Today the BRI is linked to two-thirds of the world’s population, and has to-date seen investment of more than US$1 trillion.

Read more: China's new Silk Road is all part of its grand strategy for global influence

While the current Italian government has not been fully unified toward China, a severe economic downturn has made the world’s second largest economy look more appealing to it. Alberto Bradanini, Italy’s former ambassador to China, has stressed that Europe’s own indecision and inability to tackle trade deficits with China (of which Italy contributed approximately €176m, or an eighth of the EU’s total trade deficit) is a key motivator behind this decision.

Italy wants to enhance its “Made in Italy” brand through increasing trade – especially in the form of exports – to China. The BRI is seen as a vehicle to achieve this. Italy offers goods (in particular luxury goods and foodstuffs) that are attractive to China’s growing middle class and increasingly affluent population.

China is also interested in investing in Italian firms. More significant, however, are Italy’s key infrastructure assets. This would enhance the transport and trading network of the BRI, giving it strategic access to Europe. Less than 2% of Italy’s sea imports come from China so there are substantial prospects for growth in that area.

A deal between Genoa’s port authority and shipping firm China Communications Construction Company (CCCC) has already been approved by the Italian government. And the port city of Trieste hopes for something similar. This would offer China and the BRI a more direct route to move goods onto the European continent and an ideal hub for accessing new rail lines and transport networks to Germany, Austria, Slovenia and other regional economies. By giving China access to its ports, Italy is hoping for infrastructure investment from China’s Asian Infrastructure Investment Bank (AIIB) – something the Italian government is trying to link to its role in the BRI.

With the port city of Palermo due to be part of Xi’s itinerary, it is clear that China is focused on European shipping terminal options. Following Algeria’s joining of the BRI in mid-2018, Palermo could help establish a new North African trade corridor.

The international response to Italy’s decision has been, at best, mixed. Germany and France have led the charge, raising concerns of China’s poor reputation regarding transparency, unfair BRI practices of favouring Chinese firms, as well as Chinese protectionism restricting European firms from Chinese projects.

The EU is clearly particularly concerned about what Italy’s decision means for the bloc’s China Policy. It is important to note, however, that when it comes to the BRI, Europe’s unified China’s Policy fell as early as 2017. It was then that Premier Li Keqiang’s visited Hungary and the coalition of Central and Eastern European Countries (CEEC), also including Poland and the Czech Republic, signed up to the BRI. Greece, Portugal and Croatia then followed suit.

The US has also derided Italy’s decision to break the G7 position on the BRI. The Trump government has labelled the BRI as a vehicle for debt trap diplomacy and accused the BRI of being nothing but a vanity project.

The growing tensions between China and the US do not help matters. The two sides are locked in a trade war and US charges of espionage against Chinese tech firm Huawei encapsulate its fears over Chinese investment in strategic industries and acquisitions. But traditional alliances seem to have fallen to the wayside, as Telecom Italia has agreed to remain partnered with Huawei.

The full impact of Xi’s visit to Italy will become more clear come April 9 when Brussels is scheduled to host an EU-China summit. In the build up however, the EU’s increasingly China-sceptic leadership has published an official strategy document labelling China a “systemic rival”. Targeting the BRI specifically, it calls upon member states to work together to pressure the Chinese for more accountability and greater transparency in the area of infrastructure and investment projects. Furthermore, on March 18th the EU tabled a proposal calling upon all member states to ban Chinese firms from bidding on public procurement projects.

Italy’s status as a G7 country is a coup for the Chinese leadership and the legitimacy of the BRI. While the prospect of Italy’s participation underscores growing fault lines in the EU’s joint approach to China, China has also been effective at dividing and conquering EU member states by targeting them individually.

So Italy’s decision to join the BRI is significant. But four years ago we saw Italy, France and Germany join China’s AIIB, contrary to US wishes. Therefore, Italy is neither the first, nor will it be the last European economy that will “go rogue” and follow its own national interest with regard to China.
Italy signs $2.8 billion in deals with the Belt and Road Initiative.