Daily Management Review

China's expansion into Europe: Italy’s ports are next


03/21/2019


Container ships with Chinese goods for the EU countries pass the Suez Canal but do not moor right away in the ports of Greece and Italy. More often, they spend five or six days more to go around the waters of the Atlantic to Rotterdam, Antwerp, Hamburg or Bremerhaven.



Oliver
Oliver
Experts say that these ports in the Netherlands, Belgium and Germany work more efficiently and, most importantly, provide more diverse transport opportunities for the further delivery of goods to the most important sales markets in Europe.

China believes that this situation with the ports in Southern Europe has to be changed, and Chinese President Xi Jinping will soon visit Italy for this purpose. Judging by reports from the country, on March 22 it intends to join the Chinese project One Belt, One Road, which journalists like to call the New Silk Road.

From the point of view of Beijing, it is the turn of Italy to join the initiative. Experts believe that China is primarily interested in two ports: Genoa in the industrialized north-west of the country near France and Switzerland, and Trieste in the most northeast in the Adriatic Sea, near Venice and on the border with the EU members Slovenia and Croatia. Yet, both cities are already overbuilt, so that large-scale expansion of ports will not work.

At the same time, these sea gates are very promising from a transport point of view. A railway to Switzerland is being built from Genoa. Once ready, it will become a very convenient way to supply Germany, France and many other European countries. In turn, the European Union-supported South European railway corridor from Spain to the border of Ukraine should pass through Trieste. The problem is that both projects have stalled, because the building requires breaking through the Alps to create one large tunnel. Many local residents and environmentalists oppose this.

EU is preparing a program to counter China

Shortly, Xi Jinping has to show a lot of diplomatic skill at the talks in Rome. The main result of his visit should be signing of a framework document on the official accession of Italy to One Belt, One Road. It is still unknown what kind of agreement there will be.

Rome’s intention to conclude such an agreement was strongly criticized in Brussels, Berlin and Washington. After all, none of the leading Western G7 countries has yet agreed to such a rapprochement with communist China. Italy's partners in the European Union, including Germany, reproach it for undermining the EU’s efforts to pursue a common foreign policy and uphold common values.

Moreover, the Italian-Chinese rapprochement is taking place just at the very moment when the European Union intends to adopt a plan for opposing China. The union aims to curb the global economic expansion of China, accompanied by systematic dumping and other violations of the free trade rules. In addition, Brussels is going to strictly demand that the discrimination against European companies in China be stopped.

Similar demands are being placed on China and the United States, which have declared a trade war and are trying to win concessions from Beijing. Washington sharply criticized Italy’s intention to join the Chinese project, stating that it thereby casts doubt on its international reputation and on the US-Italian friendship.

In response, Rome states that, in one form or another, agreements with China on participation in the One Belt, One Road project have already been signed by a half dozen mainly Eastern European members of the European Union from Bulgaria and Hungary to Croatia and Estonia, and the German city of Duisburg became the final point of one of the China-initiated railway routes, so that Germany is simply afraid of additional competition to its ports in Hamburg and Bremerhaven.

Rome’s desire in significantly deepening cooperation with China is more than understandable: in conditions when the Italian economy again fell into recession, the country's debt burden became rampant, and the ruling coalition went to aggravate relations with the European Union, the government seeks to attract more Chinese investment, especially in large infrastructure projects.

Critics of this approach warn that Rome’s hopes for a strong economic impulse may not be justified, since China usually seeks to transfer profitable orders to its own firms, and Chinese workers are brought to construction sites and enterprises abroad.

Yet, skeptics see the main danger in Beijing’s readiness to provide loans through Chinese or international banks controlled by it: experts fear excessive financial and, as a result, political dependence. 

source: dw.de






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