Italy hardens stance on China, in line with EU investment push

Italy is pledging to march in line with European Union allies as the bloc toughens its stance on China, after the U.S. and EU took Rome to task for cozying up to the Asian power early last year.Vincenzo Amendola, Italy’s minister for European affairs, said in an interview with Bloomberg on Tuesday that EU states have for too long failed “to make reciprocity a priority” with China.

“Italy is geared toward trade with everyone, but accords with China must today pass through a commitment of the 27, because foreign trade has to do with European sovereignty,” said Amendola, of the center-left Democratic Party. “The European Commission manages trade for everyone, so we think it’s fundamental that we work within the European framework.”

Italy has been gradually shifting its stance toward Beijing after the previous government joined China’s massive Belt and Road Initiative infrastructure project in March 2019, the first Group of Seven nation to do so. Chinese President Xi Jinping presided over the signing of a memorandum of understanding at the time, with a ceremony at a Renaissance-era villa in Rome.

The accord sparked concerns in Washington and European capitals about a Chinese push for economic influence in Europe. German Foreign Minister Heiko Maas warned at the time that if some countries “think they can do clever deals with the Chinese, they will come down to earth with a bump.” Italian officials retorted that Germany and France had far closer economic ties with China than Italy.

Italy has failed to build on the memorandum with lucrative investments, and hasn’t seen the resulting economic boost it had hoped for. Rome has meanwhile toughened its stance on China’s human rights record and on restricting Huawei Technologies Co. involvement in building fifth-generation data networks.

2020 Target

After a video conference Monday that brought together German Chancellor Angela Merkel, European Council President Charles Michel, European Commission President Ursula von der Leyen and the Chinese leader, the bloc’s representatives said the ball is in China’s court if it wants to meet a 2020 target date for sealing a long-sought investment deal.

Amendola noted in the interview that he and his party were not part of the government that signed up for the Belt and Road plan and had always opposed the decision to sign on. The Democrats, or PD, forged an alliance with the anti-establishment Five Star Movement to form Prime Minister Giuseppe Conte’s second coalition last summer.

“I share the European Union position on China,” Amendola, 46, said. “When it comes to market forces, what we can do in Europe is not allowed in China. Europe has clear, transparent, market-driven rules that are applied by all 27 member states and we apply this level playing field also to our commercial partners.” China “has an issue with free competition among its market players,” the minister said.

EU-China relations have been strained this year by alleged Chinese disinformation about the coronavirus, by Beijing’s controversial national security law for Hong Kong and by stepped-up European efforts to protect domestic manufacturers from foreign competitors.

Zhang Ming, Beijing’s ambassador to the EU, said on Tuesday that China is ready to begin trade negotiations with the bloc.

“China calls on the EU to jointly kick-start the free-trade agreement process at an early date,” Zhang told Bloomberg in an interview. “China is ready—the ball is in the EU’s court.”

Zhang also said that China has addressed many of the restrictive measures highlighted by the EU, and said progress has been made on issues including forced technology transfers. There will be further high-level discussions later this month to cover sustainable development and market access, he said.