How the EU failed Italy

Editor's Note:Tom Fowdy, who graduated from Oxford University's China Studies Program and majored in politics at the Durham University, writes about international relations focusing on China and the Democratic People's Republic of Korea. The article reflects the author's views, and not necessarily those of APD.

This week has been eventful for EU-China relations. On Thursday, the European Leaders Summit saw figureheads across the continent discuss in private how to formulate the bloc's strategy towards Beijing, following the release of a report from the commission which described the Asian giant as a "systemic rival."

This all came in anticipation to the upcoming EU-China summit on April 9, whereby German Chancellor Angela Merkel, French President Emmanuel Macron and others will meet with Chinese President Xi Jinping to hash out some new agreements.

These two leaders, in particular, have been advocating a more firm approach toward Beijing, driven by skepticism of the country, and hope to steer the rest of the bloc in the same way.

In the background to it all, Italy on Saturday signed a memorandum of understanding with China to formally ascend to the Belt and Road Initiative, at the same time penning out a number of business deals which will see the country receive substantial investment.

The move was, of course, met with skepticism and displeasure by the aforementioned countries, as well as the United States, who have stoked fear of “Chinese influence” seeping into the continent.

But in the midst of the subtle disapprovalthat Rome is facing for its decision, there are some fundamental aspects which are being forgotten here on behalf of the bloc. That is, Europe has ultimately failed Italy.

European leaders pose for the family photo during the EU summit in Brussels, Belgium, March 22, 2019. /VCG Photo

As much as the rhetoric of "European Unity" abounds in the rhetoric of both the commission and Macron/Merkel, such talk has delivered little substance in practice.

It is not a union of equals. Instead, fundamental structural and economic inequalities within the bloc have, in fact, punished many of its members, which is why Italy has grown to see more opportunity in Beijing than in Berlin or Brussels.

The year 2008 was a turning point for the European Union. The global financial crisis and the subsequent recession had malign consequences for the Eurozone, which saw a catastrophic debt crisis emerge amongst the nations of Southern and Mediterranean Europe which hammered the value of the common currency.

The response of the "core" of the bloc, that being leading nations such as Germany, was to compel these nations, not least including Italy, Greece, Spain and Portugal, to collectively address their debt problems by resorting to eye-watering austerity measures, that being drastic cuts in government spending, structural reforms and crippling repayments on tight deadlines.

They were to do so in the peak of a global recession, which would spell even more pessimistic news for these countries.

The subsequent path by which these countries were pushed on by the leaders of the Eurozone saw their GDP tumble, as well as unemployment surge. The ripples of the economic shockwaves inflicted upon the countries would unleash political chaos and populism which sharply challenged the status quo.

In Greece and Italy in particular, this involved the emergence of soft Euro-skeptic movements which challenged the ideal of the Eurozone and the rampant unfairness of fiscal policies which were geared toward the interests of German-based financial institutions.

Italy's Interior Minister and Deputy Prime Minister Matteo Salvini (C) delivers a speech in the tunnel of the TAV high-speed train line between Italy and France, which the Five Star Movement demands be scrapped, February 1, 2019. /VCG Photo

This saw the rise of the Five Star Movement in Italy, which would eventually rise to government and engage in a longstanding diplomatic standoff with Brussels haggling over the country's debt ceiling.

Indeed, as of 2019, the country has again entered a recession. Unemployment remains high, and young people are leaving the much-admired nation in droves.

As a result, the sense of national anger and distrust toward the core of the European Union from Rome remains high. The discourse of "European solidarity" and so forth are perceived as superficial and empty promises, and, for many, even a substantial part of the woes which have been inflicted on the country.

Therefore, it should not be a surprise to anyone that Italy has instead sought to diversify its options in the world and see new opportunities in the BRI. Yet, there is a significant amount of hubris on the part of European leaders, and, of course, the United States that fails to recognize or even acknowledge what set them on such a course.

In summary, Italy has made a decision in accordance with its national interest, to look overseas for new and innovative economic opportunities. There is no harm in such transcontinental cooperation.

Ultimately, a decade's worth of EU fiscal policy has not helped the country in any way, placing and grounding it in an economic plight that it has struggled to emerge from.

In this case, this debate should not be about how China is a "threat" to Italy, but instead how policies of the bloc ultimately failed the country, as well as others in the region, and led them to look further afield.

(CGTN)