Chinese New Year festivities in Milan last month

The center-right populist Italian government has recently bowed to Chinese flattery, announcing it was ready to sign a Memorandum of Understanding that will connect Rome and Beijing on a modern Silk Road. At the end of a long, slow path of decline and political confusion, Rome is in bad need of fresh investment to boost its impoverished economy. Italy, which in 1957 helped found the European Economic Community, still counts as one of the most important EU members and is turning its back on Brussels in hopes that distant Beijing can solve its problems.

Italy was once famous for being a nation of Saints, Poets, and Sailors, and until 30 years ago it was a member of an exclusive club: among the five most developed countries of the world. The country was booming in the late 1980s, until the fall of the Berlin Wall. Instead of more prosperity, as arrived in the countries of emerging economies, the end of the Cold War for Italy was the beginning of a disaster. With less U.S. support, and the explosion of a massive corruption scandal, Tangentopoli, Italy stepped through what now seems to be a point of no return. In 1992, the corruption scandal paralyzed the whole country: half of the Italian Parliament was investigated, while the major political parties that ran the country for decades collapsed. As judges were replacing politicians and calling the shots, a political vacuum was created. The void was soon filled by Silvio Berlusconi, the media tycoon, who, after he lost his political sponsors, needed to protect his livelihood. He needed to get into the prime minister's office to cover up his dubious businesses.

More than 25 years later, Italy still suffers from the consequences of Berlusconismo: high unemployment, widespread tax evasion, enormous public debt, and young people and talents that flee the country at first opportunity. But last year it got worse when — after a left-wing interregnum that gave little hope to the pauperized country — the elections brought to power two populist parties: the Five Star Movement (M5S) and the League (La Lega). The two movements agreed on the program and formed the government with a prime minister, Giuseppe Conte, who does not belong to either of the two political forces.

This government has now prepared the aforementioned Memorandum of Understanding (MOU), which will be signed in Rome this week during the visit of Chinese President Xi Jinping. Launched by President Xi in 2013, the New Silk Road project, also known as the Belt Road Initiative (BRI), is considered the largest program of economic diplomacy since the US-led Marshall Plan for postwar reconstruction in Europe, and will include dozens of countries and a total population of more than three billion people.

The idea that both sides are now trying to sell is that the BRI is nothing but a modern version of the Silk Road, the ancient network of trading routes that stretched from China to Italy, transporting goods, skills, and ideas halfway around the world. As it is now, more than a thousand years later, a shrunken Italy hopes to play an equally important role in international development. But in joining the BRI, Italy risks having an even smaller role in this world.

Rome intends to open the ports of Italy for Chinese merchandise and technology coming out of Asia, creating transport hubs and rebuilding its crumbling infrastructure, a plan that has provoked a strong reaction from Brussels and Washington. As I am writing this post, growing speculations out of Rome include the possibilities that Beijing might tackle Italy's enormous public debt, which as a matter of fact would resolve one of the European Union's enormous problems, but at a high price. China will now sit in the backyard of Brussels, and want more.

With all these fast changes, I called Brussels and talked to a high official of the European Commission I've known for many years. I asked him what the EU plans to do, and what he thinks is happening in Rome. He said:

Evidently, this is another deliberate sign of Rome taking distance from the EU. The MOU is even more important than previous gestures since it comes at the moment in which the EU is making an effort to set up a consistent strategy with China based on a balance of opportunities and risks. It is fundamental that Italy in negotiations with China would obtain reciprocity. Italy should be aware that it can obtain the reciprocity only if negotiating with China respects the line with the EU.

Short of any meaningful and sustainable strategy, Italy's gesture seems to be a sign coming from the country that it's ready to sell its assets in exchange for a bit of cash, trying to resolve the poor state of its economy that has no appeal for foreign investors. The Chinese understand this situation very well and, after maybe a first and short phase of benign interest, will oblige Italy to accept their hard conditions, as everywhere in the world.

Without dramatizing this agreement, it is worth noting it further aggravates the negative image of Italy without bringing actual benefits. It would have been better for Italy to agree on a specific concrete deal for a project rather than to follow this unwise and politically costly path.

A devastating assessment. Brussels can do very little to stop what the adventurous government in Rome is up to. It can smash the Catalan referendum, but it cannot stop Italy from leaving the boat.

This was bound to happen.

On the other hand, this was bound to happen. Ten years ago when I was working in Italy as a reporter, I investigated the Chinese economic presence in Italy; Italy was the first of the developed countries that suffered the entry of China in the World Trade Organization. Italian businesses, fragmented but very creative and highly productive, were located mostly in the north of Italy where the current government has its roots and lost its ground against the flood of much cheaper products coming from China. It was not only the area of Prato, once famous for its textile industry but now populated predominantly by the Chinese labor community. There was also illegal penetration of poorly controlled Italian ports, where the Chinese for more than a decade have landed thousands and thousands of containers of merchandise without paying any duties. I interviewed public prosecutors in Rome who, with the help of the Customs Police, led the investigations into the phenomena.

The prosecutor back then told me that her office wrote to the government asking what should they do. Without any concrete answer, she sent a report of their investigation to Brussels. No reaction either. She then sarcastically told me the Italian government should negotiate with Beijing a certain amount of commission on a yearly basis. It would be enough to run a national budget with this, the prosecutor said with a wry smile on her face.

Sunrise in Shanghai — Photo: Dave Ginsberg

A decade later, this is exactly what's happening. The future BRI agreement may as well become an Italian financial rescue plan designed in Beijing, adding legitimacy to this shadow practice. Here, on this side of the Atlantic, where the current U.S. administration couldn't care less about the EU's destiny, the news from Rome broke the ceiling. White House National Security Council spokesman Garrett Marquis said the belt and road scheme was unlikely to help Italy economically and could significantly damage the country's international image. The U.S. government first warned Rome not to give access to the Chinese at the port of Trieste, as well as further cooperation between the leading electricity providers of both countries. The Prime Minister Conte refused: "With all the necessary precautions, Italy's accession to a new silk route represents an opportunity for our country."

Other than the prime minister, considered a puppet at the hands of the two coalition parties, the Italian official who most strongly promoted better ties with China is Deputy Prime Minister Luigi Di Maio, the 32-year-old leader of the Five Star Movement. As South China Morning Post reported:

Di Maio also leads the Ministry of Economic Development. His deputy in that ministry, Michele Geraci, held several university positions in Zhejiang province and in Shanghai for a decade before his official appointment last year.

In charge of Italy's international trade, he is regarded as playing a central role in Rome's warming ties with Beijing. In an interview with Bloomberg last year, Geraci said the current administration had taken a different stance, adding: "We are trying not to ignore China as has been done in the past.

Italy's Foreign Minister, Enzo Moavero Milanesi, visited Washington in January and held meetings with Secretary of State Mike Pompeo and National Security Adviser John Bolton, expressing a seemingly different opinion from his government. Among other things, he discussed banning Chinese telecom giant Huawei from 5G mobile development, the Italian media reported. However, the impact of the U.S. and Brussels on the Italian decision might be hard to quantify. Italy is by no means the only member of the E.U. to show interest in BRI and Chinese investments. Several E.U. countries have already started forms of cooperation with Beijing. And it is not just marginal and indebted countries like Greece, but the leading economies of the old continent. Suffice it to say that, if between 2000 and 2018 Beijing invested about 15 billion euros in Italy, Chinese investments in France were roughly the same level, and in Germany, they exceeded 22 billion euros. Meanwhile in the UK they came close to 50 billion euros, according to a recent study by Merics and Rhodium Group.

Before they jump the fence, the Italians, who in principle ought to be more loyal to the strategic partnership with the E.U. they helped found, should also read more carefully the reports on some difficulties BRI projects are encountering around the globe. Last December, Bloomberg published a report that is indicative of how China imagines navigating this boat. But perhaps even more interesting is a recent alert that comes from Minxin Pei, an expert on U.S.-Asia relations:

Beneath the surface, there is growing unease in China about BRI. And rightly so. With the country feeling an economic squeeze, fighting a trade war with the U.S. and facing criticism from nations receiving BRI funds, Chinese skeptics, including academics, economists and business people, of BRI are quietly asking if their government is putting its scarce resources to the right use. To be sure, there are no official announcements that Beijing is about to pare back Xi's BRI dreams. Tight censorship has removed any direct criticisms of BRI from the media.

Minxin's observation on the economic difficulties China will have to face in coming months and years is that while leaders in Beijing continue to stand by BRI, Xi's original ambitions are being rolled back out of public view. We should not be surprised if Beijing eventually lets BRI, at least BRI 1.0, die quietly, Pei concludes.

Is Pei's just one of many different opinions? Perhaps, but what is happening is extremely interesting and coming upon us much faster than expected. So for the time being, if I were you, I would not miss a second in watching what will happen in Italy when Xi Jinping and his court land in the jewel country of Mediterranean.

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Over the past week thousands of migrants have arrived at the international bridge in Del Rio, Texas, on the border between Mexico and the United States. According to Del Rio's mayor, border patrol agents are struggling to process new arrivals, with about 4,000 migrants currently waiting.

Hannah Steinkopf-Frank, Bertrand Hauger and Anne-Sophie Goninet

👋 Сайн уу*

Welcome to Friday, where the new U.S.-UK-Australia security pact is under fire, Italy becomes the first country to make COVID-19 "green pass" mandatory for all workers, and Prince Philip's will is to be kept secret for 90 years. From Russia, we also look at the government censorship faced by brands that recently tried to promote multiculturalism and inclusiveness in their ads.

[*Sain uu - Mongolian]

🌎  7 THINGS TO KNOW RIGHT NOW

• U.S. facing multiple waves of migrants, refugees: The temporary camp, located between Mexico's Ciudad Acuña and Del Rio in Texas, is housing some 10,000 people, largely from Haiti. With few resources, they are forced to wait in squalid conditions and scorching temperatures amidst a surge of migrants attempting to cross into the U.S. Meanwhile, thousands of recently evacuated Afghan refugees wait in limbo at U.S. military bases, both domestic and abroad.

• COVID update: Italy is now the first European country to require vaccination for all public and private sector workers from Oct. 15. The Netherlands will also implement a "corona pass" in the following weeks for restaurants, bars and cultural spaces. When he gives an opening speech at the United Nations General Assembly next week, unvaccinated Brazilian President Jair Bolsonaro will defy New York City authorities, who are requiring jabs for all leaders and diplomats.

• U.S. and UK face global backlash over Australian deal: The U.S. is attempting to diffuse the backlash over the new security pact signed with Australia and the UK, which excludes the European Union. The move has angered France, prompting diplomats to cancel a gala to celebrate ties between the country and the U.S.

• Russian elections: Half of the 450 seats in Duma are will be determined in today's parliamentary race. Despite persistent protests led by imprisoned opposition leader Alexey Navalny, many international monitors and Western governments fear rigged voting will result in President Vladimir Putin's United Russia party maintaining its large majority.

• Somali president halts prime minister's authority: The decision by President Mohamed Abdullahi Mohamed marks the latest escalation in tensions with Prime Minister Mohamed Hussein Roble concerning a murder investigation. The move comes as the Horn of Africa country has fallen into a political crisis driven by militant violence and clashes between clans.

• Astronauts return to Earth after China's longest space mission: Three astronauts spent 90 days at the Tianhe module and arrived safely in the Gobi desert in Inner Mongolia. The Shenzhou-12 mission is the first of crewed missions China has planned for 2021-2022 as it completes its first permanent space station.

• Prince Philip's will to be kept secret for 90 years: A British court has ruled that the will of Prince Philip, the late husband of Britain's Queen Elizabeth who passed away in April at 99 years old, will remain private for at least 90 years to preserve the monarch's "dignity and standing."

🗞️  FRONT PAGE

With a memorable front-page photo, Argentine daily La Voz reports on the open fight between the country's president Alberto Fernández and vice-president Cristina Kirchner which is paralyzing the government. Kirchner published a letter criticizing the president's administration after several ministers resigned and the government suffered a major defeat in last week's midterm primary election.

#️⃣  BY THE NUMBERS

€150

An Italian investigation uncovered a series of offers on encrypted "dark web" websites offering to sell fake EU COVID vaccine travel documents. Italy's financial police say its units have seized control of 10 channels on the messaging service Telegram linked to anonymous accounts that were offering the vaccine certificates for up to €150. "Through the internet and through these channels, you can sell things everywhere in the world," finance police officer Gianluca Berruti told Euronews.

📰  STORY OF THE DAY

In Russia, brands advertising diversity are under attack

Russian sushi delivery Yobidoyobi removed an advertisement with a Black man and apologized for offending the Russian nation, while a grocery chain was attacked for featuring an LGBTQ couple, reports Moscow-based daily Kommersant.

❌ "On behalf of the entire company, we want to apologize for offending the public with our photos..." reads a recent statement by Russian sushi delivery Yobidoyobi after publishing an advertisement that included a photograph of a Black man. Shortly after, the company's co-founder, Konstantin Zimen, said people on social media were accusing Yobidoyobi of promoting multiculturalism. Another recent case involved grocery store chain VkusVill, which released advertising material featuring a lesbian couple. The company soon began to receive threats and quickly apologized and removed the text and apologized.

🏳️🌈 For the real life family featured in the ad, they have taken refuge in Spain, after their emails and cell phone numbers were leaked. "We were happy to express ourselves as a family because LGBTQ people are often alone and abandoned by their families in Russia," Mila, one of the daughters in the ad, explained in a recent interview with El Pais.

🇷🇺 It is already common in Russia to talk about "spiritual bonds," a common designation for the spiritual foundations that unite modern Russian society, harkening back to the Old Empire as the last Orthodox frontier. The expression has been mocked as an internet meme and is widely used in public rhetoric. For opponents, this meme is a reason for irony and ridicule. Patriots take spiritual bonds very seriously: The government has decided to focus on strengthening these links and the mission has become more important than protecting basic human rights.Russian sushi delivery Yobidoyobi removed an advertisement with a Black man and apologized for offending the Russian nation, while a grocery chain was attacked for featuring an LGBTQ couple, reports Moscow-based daily Kommersant.

➡️ Read more on Worldcrunch.com

📣 VERBATIM

"Ask the rich countries: Where are Africa's vaccines?"

— During an online conference, Dr. Ayoade Olatunbosun-Alakija, of the African Vaccine Delivery Alliance, implored the international community to do more to inoculate people against COVID-19 in Africa and other developing regions. The World Health Organization estimates that only 3.6% of people living in Africa have been fully vaccinated. The continent is home to 17% of the world population, but only 2% of the nearly six billion shots administered so far have been given in Africa, according to the W.H.O.

✍️ Newsletter by Hannah Steinkopf-Frank, Bertrand Hauger and Anne-Sophie Goninet

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