General Secretary of China Xi Jinping’s tour of Italy, Monaco and France on March 21–26, 2019, caused a stir across Europe. What approach should be taken to projects being proposed under the Belt and Road Initiative? What threats are posed by China’s penetration into the EU economy? What foreign economic policy should be pursued in the current trade and economic confrontation between the United States and China? These and similar issues have been discussed by European leaders for years, and now, with Xi Jinping’s latest visit, the debates have taken on a new significance. While Brussels and Berlin are more concerned about maintaining competitiveness with China, Rome only added fuel to the fire, becoming the first EU founding country to join the Belt and Road Initiative, despite Europe’s attempts to come up with a joint stance on its relations with China.
Paris could not resist getting involved, especially since France was hosting Xi Jinping in the year marking the 55th anniversary of the country’s official recognition of the People’s Republic of China. President of France Emmanuel Macron and his government are attempting to identify the opportunities and threats of cooperating with Beijing and determine how French diplomacy should act in order to maximize the potential benefits and avoid possible mistakes. At the same time, China is a hot topic in French society, with politicians, international affairs experts and journalists all discussing it. French business is also closely watching the situation, looking for new opportunities to break into the Chinese market while protecting its interests from competition in the East.
This article deals with the specific features of France’s take on its relations with China: 1) the basic sentiments about and assessments of China; 2) the reasons for the French leadership’s concerns about China’s might; 3) the benefits of cooperation between France and China; and 4) the impact of the France–China dialogue on the interests of other international actors.
China: Pros and Cons
When visiting China in January 2018, Macron stated, rather pompously, that France and China were “sharing a rational view of global history” and “building a great friendship” based on the shared values of “reason, fairness and balance.” However, Macron subsequently hinted repeatedly at the danger of China’s “hegemony” (including in Canberra in May 2018) and stressed that “the times of Europe’s naivety with regard to China are over” (in Brussels in March 2019). While these statements seemingly contradict one another, they demonstrate perfectly well the duality of opinions currently held in France about China. This applies not just to Macron, but to the entire country.
On the one hand, there is a notionally “pro-Chinese” camp, whose representatives speak favourably about China and even maintain certain ties with the it. Strange as it may seem, this view is shared by many retired and active politicians. One of these is Jean-Luc Mélenchon, the leader of the far-left movement Unbowed France. Back in 2008, during an escalation in Tibet, Mélenchon sided with Beijing and spoke against the idea of boycotting the 2008 Summer Olympic Games in China. In the run-up to the 2017 presidential election in France, he hailed China’s economic achievements and suggested that that country, “with its industry, technology, science and cultural development,” should be a privileged partner of France. The French Socialists can boast an even richer history of contacts with China: in 1981, shortly before he was elected president, François Mitterrand visited the country as part of his party’s delegation, and President François Hollande in 2014 received Xi Jinping in Paris (he also visited with Xi Jinping in China in 2018, following his resignation from office).
There are also pro-Chinese politicians to be found among France’s right-wing politicians. In particular, former Prime Minister Jean-Pierre Raffarin has long been a major lobbyist for business contacts with China (he has even been officially cleared to conduct this activity recently by the Ministry of Europe and Foreign Affairs of France). Laurent Wauquiez, the current leader of the center-right party The Republicans, is formally against Chinese capital infiltrating the French economy, but the region of Auvergne-Rhône-Alpes over which he presides recently founded a joint financial fund with Chinese partners. Wauquiez himself visited China in 2017 to hold meetings in support of the Republican presidential candidate François Fillon.
Several former politicians of different affiliations, including former ministers, are now employed by Chinese companies, including Jean-Louis Borloo, who is with Huawei, and Bruno Le Roux, who is with CRRC. Both houses of the French parliament have France–China friendship groups. In the Senate, approximately a third of the group is represented by the Republicans. In the National Assembly, the group is dominated by the president’s centrist party The Republic on the Move! (with Unbowed France also represented). Finally, some of the current government members (Prime Minister Edouard Philippe and Ministry for the Economy and Finance Bruno Le Maire) periodically visit China in hopes of strengthening bilateral economic ties.
On the other hand, there is the camp of anti-China “alarmists”, which is wary of Beijing’s growing influence. The most vocal member of this camp is Marine Le Pen, who is urging “reasonable protectionism” in France’s trade and economic relations with China, not unlike that professed by President of the United States Donald Trump. However, the key vigilantes when it comes to China are not individual politicians, but some very reputable international experts. President of the French Institute of International Relations (IFRI) Thierry de Montbrial is says that China is “playing the intra-European controversies,” using a “quasi-imperial” strategy in its efforts to implement the Belt and Road Initiative and striving to become the leading world power in the next few decades. IFRI Director Thomas Gomart concurs, noting that China’s increasing foreign activity is matched by its growing authoritarianism at home. Their colleague Alice Ekman explains that China and France have differing views of the multifaceted world, even if they describe it in the same vein: for Beijing, it is a source of influence, while for Paris it is more of a way of seeking European unity. Pascal Boniface, Director of the French Institute for International and Strategic Affairs (IRIS), points out that China is deliberately developing bilateral ties with the EU member states, as it easily outweighs any single European country. François Godement, a Senior Advisor to Institut Montaigne, remarks that China historically is very consistent in protecting its interests and is unlikely to compromise, which is quite uncomfortable for Europe when it comes to negotiations.
These and similar opinions are being actively disseminated by the French media, which often sound alarmist with regard to Chinese politics. In fact, many French citizens seem to identify with this alarmism. A recent survey conducted by Kantar Group indicates that 81 per cent of those polled believe China to be “an influential world power,” with 60 per cent of respondents describing the country as being influential or extremely influential with regard to France. A total of 47 per cent define EU–China relations as being imbalanced in favour of China. In addition, 50 per cent of those polled perceive Chinese investments negatively, and 47 per cent believe China has already overtaken France technologically.
A Power Imbalance
In actual fact, France does have good reason to be vigilant.
First, France is evidently no match for China economically. Back in 1980, the two countries were comparable in terms of their GDP PPP share: France was slightly stronger, at 4.32 percent against Communist China’s 2.32 percent. Now, almost 30 years on (in 2018), Beijing is in a totally different league with 18.72 percent, against Paris’s meagre 2.19 per cent. According to the French treasury and customs service, there is a massive imbalance in bilateral trade in favour of China. In 2017, Beijing purchased 19 billion euros’ worth of French commodities (4 percent of all French exports, which put China in the seventh place among France’s key foreign customers), but exported 49 billion euros’ worth of goods to France (9 per cent of all French imports, making Beijing the country’s second largest supplier). Interestingly, no other country in the world demonstrates such an imbalance in its trade with France. France’s overall share of the Chinese market is relatively low at 1.5 per cent (mainly present in China’s aerospace, electronics, agricultural, chemical and luxury sectors).
According to the French Embassy in Beijing, there are 1100 French companies operating in China which have generated a total of 570,000 local jobs. In France, the 700 Chinese and Hong Kong businesses support just 45,000 jobs. The possibility of France’s strategic economic sectors falling into the Chinese hands may not appear to be as much of a problem as it is in Italy and Germany at the moment, but there are certain preconditions for this (given China’s sustained interest in the Port of Marseilles, DongFeng Concern’s participation in Groupe PSA, etc.). Chinese investment in France grew by 86 per cent in 2018, with the highest growth reported in the hi-tech sector. The French government expects to be able to resist this “plunder” (as Le Maire put it) by way of expanding the scope of the 2014 Montebourg Decree, under which any investment in France’s strategic sector is to be approved by the government.
Second, France is extremely wary of potential Chinese espionage (including, but not limited to, industrial espionage). In December 2017, the French authorities detained several people who were believed to have been Directorate-General for External Security (DGSE) officers subsequently turned by China. According to Le Monde, they had been feeding China information about their former employer’s operating methods. In October 2018, the media picked up Le Figaro’s investigation, which had concluded that Chinese secret services were actively using fake social network accounts to make contact with French public servants and employees of key healthcare, IT and nuclear enterprises. Promising candidates would be offered remuneration for their cooperation and an opportunity to visit China “for a conference or seminar.” In this context, it is worth noting that France is home to the largest Chinese community in Europe (approximately 500,000 people), which is hard for the French authorities to penetrate and may potentially be used by Chinese diplomats and secret services “for the acquisition of political, scientific, technological and commercial intelligence.”
Third, France and China directly compete in certain regions, first and foremost in Africa. France, for example, is worried about China’s military and economic presence in Djibouti. Macron visited the country during his recent tour of Africa. Of no less import was his visit to Ethiopia, where French businesspeople are aiming to carve a bigger niche (including at the expense of China). Also, China is sizing up the potential resources of the Sahel, especially the uranium in Niger, which has historically been controlled by France (as represented by Operation Serval in Mali). Notably, in January 2019, China joined the financing of the G5 Sahel joint contingent and also proposed to equip and outfit the force. France is also nervous about China’s growing naval might. Hence Paris’s contacts with the Japan Maritime Self-Defence Force and its effort to build 12 Barracuda-class submarines for Australia.
Reasons for Rapprochement
All this notwithstanding, in building its policy towards China, France is weighing up all the pros and cons of developing a partnership with the country.
These certainly include new economic advantages. The French leadership believes that, if China agrees to let the country into its domestic market and also develops the Belt and Road Initiative on the basis of reciprocity, then this will somewhat correct the trade imbalance currently observed between the two countries. Accordingly, the vision is that Chinese capital penetrating the EU economy could be both curtailed in France and somehow made up for by similar activities in China. Exports to China are of particular importance to French companies at present, as the national economy is still recovering from years of stagnation. In this sense, the main result of Xi Jinping’s visit to Paris was the signing of a hefty bundle of business contracts, including the Airbus deal for 300 airliners worth a whopping 30 billion euros. Immediately after Xi Jinping’s tour, Beijing sent another important signal that it is prepared to cooperate: the country’s intellectual property court had suddenly sided with the French appellant in a trial.
In addition to the economy, Paris has certain foreign policy ideas with regard to Beijing. France’s logic suggests that maintaining full-fledged ties with China, as well as reciprocal visits and joint declarations, is an indication of its important role in the world and stresses its status as a country that is capable of independently developing dialogue with the strongest global powers. Moreover, this dialogue concerns high-profile issues, including multilateralism, global trade reform and climate change (in their joint communique, Macron and Xi Jinping agreed that their positions were close on most of the topics). Xi Jinping’s visit to France is being used by both parties as a demonstration of their prestige, and the Chinese leader used this notion expertly by mentioning, in his piece for Le Figaro, the spirit of independence which guided France 55 years ago when it recognized Communist China.
Today, however, the French leadership is striving for supremacy, not only at the national level, but also across all of Europe. The long-standing dream of the French presidents has always been to increase their own authority and use Europe as a kind of magnifying lens. This dream is now becoming increasingly important in the context of China. Macron is aiming to form a common European front above and beyond bilateral relations with Beijing, one that should allow every EU member to talk to China with one voice and defend common interests in the face of a common “systemic rival” (as the European Commission recently described China). It is for this very purpose that Macron invited Chancellor of Germany Angela Merkel and President of the European Commission Jean-Claude Juncker for the concluding phase of his talks with Xi Jinping (so the two could outline once again that the European Union’s chief criterion for China’s projects was mutual benefit). In an editorial piece, Le Mond said that, by taking the initiative, Macron had “proven the sincerity of his pro-EU approach and actually outlined Brussels’ new strategy towards China.” France is trying to be the main diplomatic “organizer” of the EU–China dialogue, although Italy’s behaviour (including its own business interests) seriously undermines these efforts.
China’s own interest in cooperation with France is understandable. France wields some political weight in the European Union. It is the European Union’s second largest economy with diverse industry, technology and major ports. From the point of view of the Belt and Road Initiative, it is logical to use France as another “entry point” to Europe and the Mediterranean. On a global scale, it would definitely not hurt Beijing to get close to another permanent member of the UN Security Council and a nuclear power.
Points to Consider for Other Actors
To conclude, here are a few thoughts about the significance of the current relations between France and China relations to other parties in the light of Xi Jinping’s visit to Paris.
On the whole, the European Union could either benefit or suffer from France’s evolving cooperation with China. On the one hand, it would be very convenient for Brussels if someone did all the legwork for it in terms of uniting the member states in the face of China, especially if it is the Euro-optimist Macron who does this legwork. On the other hand, there are fears that France, too, will follow in the footsteps of Italy sooner or later by officially joining the Belt and Road Initiative, given the bilateral economic interest. In that case, there would be no hope left for a united EU front; moreover, all the European integration drive would begin to erode.
The United States is being forced to revise its position in Europe in the light of Xi Jinping’s visit: is China is beginning to establish control of the European Union, pushing Washington to the side-lines? While the United States is offering the European Union a rather hard line of dialogue, China, despite all the reservations about it, is increasingly becoming a more convenient partner for European nations because of its tendency to make appealing proposals from the get-go. In addition, as Russian political analyst Timofei Bordachev notes, by including the European Union in the broader Eurasian context, Beijing is effectively securing itself against the constant fear that the United States will decide to blockade shipping routes linking China to Europe and the Middle East.
For Russia, Xi Jinping’s European tour once again demonstrated that China is being very pragmatic in refusing to make a choice between Russia and the European Union: both are equally important to its plans. It would be interesting to see how European countries, including France, seek a balance between the economic benefits from cooperation with China and the need to protect their own business, because this problem is no less relevant for Moscow. China is gradually becoming a common topic for France–Russia and EU–Russia relations.
In January 2018, Emmanuel Macron promised to arrange official visits to China annually until the end of his tenure. Whether he will keep this promise in 2019 remains unclear, but the next phase in the dialogue involving France, the European Union and China is scheduled for April 9, when the EU–China summit will be held. Xi Jinping’s March visit to France clearly demonstrated that Paris definitely wants to be an important partner of Beijing, both bilaterally and at the regional level. It is symbolic that, as the French media likes to stress, Macron’s name roughly translates into Chinese as “the horse vanquishes the dragon.” The problem, however, is that the dragon has his own plans for the horse.
First published in our partner RIAC
Fostering Tolerance in Europe: Issues of Migration and Populism in Italy
Authors: Maxim Sigachev and Elena Elena*
Tolerance remains a complicated issue in the West and Russia alike. The challenge, though, remains in the need to account for the connection between the notions of tolerance, social security, and the development of the society. The West tends to adopt a broader perspective on tolerance when compared to Russian practices. In Europe, the notions of ‘tolerance’ is informed by ‘active cooperation’ rather than merely ‘patience’, as is the case in Russia.
There are at least four dimensions to this issue in Europe:
- that of the EU’s regulatory programs;
- that of local communities;
- that of European societies at large;
- that of populism and Euroscepticism, which is believed to be the source of intolerance towards migrants and refugees.
This article is devoted to the problem of the social and political crises in Italy, which have been caused by pan-European problems (i.e., migration, anti-EU attitudes of the public) and strengthened by the national Italian conflicts (the gap between the Northern and the Southern regions, debates between the Left and the Right opposition, the rise of the populist parties etc.).
Social and political discrepancies in Italy
As a part of the EU, Italy has to get through the complex processes of adaptation to a life in a supranational union, which includes profound transformations in socio-economic, cultural, and even religious spheres. If we analyze the election agenda used by the Italian populist parties in the European elections 2019 campaign, we will notice the strong anti-EU discourse and a deep disappointment in the EU politics. Being part of the EU is conceived as a loss of independence. Further, we can notice the increasing deficit of tolerance in many spheres: religious, sociocultural, ethnic, ideological.
Research on the contemporary European political parties notes that Eurosceptical spirit is strong in developing economies and advanced economies (as is the case with Germany and the UK) alike. Thus, Italy’s crises are not necessarily unique but can be found across the Western world as well.
The crisis of Western world order manifests itself on, at least, three levels:
- the supranational level: the rise of the Euroscepticism, which is represented in the lack of tolerance and mistrust towards the European Union as an institution.
- the national level: the rise of the national populism, which identifies the crisis of multiculturalism in the European nations, zero tolerance to immigrants (the European migrant crisis or refugee crisis of 2015–2018) and refugees as bearers of alien culture, a so-called exclusive nationalism.
- the economic level: further strengthening of social populism movements, which signify the end of the European welfare state.
The European societies are characterized by a growing alienation between the rich and the poor, the elites and the people, the establishment and the middle class.
The idea of social and political divisions was first proposed by Stein Rokkan, who studied the existing divisions between political parties that are caused by cleavages between the center and the periphery, the city and the village, etc.
Rokkan’s theory was developed by Paul Lazarsfeld, who studied electoral behavior and stated that “people vote not only for their own social group but also in favor of it”.
According to S. Rokkan, the European party system was developed on the foundation of existing social conflicts. Rokkan also formulated the basic lines of conflicts such as “center—periphery”, “state—church”, “employee—employer”, “city—country”. The social discrepancies of the Lipset-Rokkan theory were built on by French political scientist D.-L. Seiler in the work Whether it is possible to apply the clivages of Rokkan to Central Europe?
We can use this theory to explain the stability of the European political systems in the second half of the 20th century and electoral behavior of the Europeans.
Among the notable works on the cleavage theory are R. Rose and D. Urwin Persistence and Change in Western party systems since 1945  S. Wolinetz The Transformation of Western European Party System Revisited M. Abrams, R. Rose and R. Hinden, G. Evans and S. Whitefield The Evolution of Left and Right in Post-Soviet Russia .
Russian scientists rarely study the Italian political system and electoral behavior in the frameworks of the cleavage theory, as they usually study the different aspects of the political life in their research papers. There are some fundamental works that attempt to analyze facts and knowledge of Italian political thought from the perspective of the communist ideology. Cecilia Kin divided the liberal political thought into purely liberal and catholic in her work Italy at the turn of the century. From the history of social political thought, K.G. Kholodkovsky and I.B. Levin compared the Italian Socialist and Communist parties.
The basic factors of social political crisis in contemporary Italy
The basic factors of the social political crisis in modern Italy can be divided into two groups. The first group includes socio-political divisions of a more historical, traditional character, whereas the second group consists of relatively new, contemporary collisions.
The North-South Divide
The contemporary socio-political crisis in Italy originates from the long-term and unfinished division between the North and the South, which has not been overcome since the Italian Risorgemento (unification) in 1861. Historically less developed Southern Italy has always faced serious difficulties. The process of modernization in Southern Italy is ongoing, the standard of living still pales in comparison to wealthy Northern regions. According to the Soviet-Russian researcher K.G. Kholodkovsky, Italy still suffers from the fact that different parts of the country existed as separate states for centuries. The most important consequence of this Italian historic disunity is economic and cultural gaps between the North and the South.
Polarization between the Left and the Right
The ideological conflict between the Right-wing and the Left-wing political forces also has historically contingent roots and goes back to the period of Risorgimento. In 19th century, the two leading political movements—republicans and monarchists—vied for leadership of a newly unified Italy.
One group of politicians led by Giuseppe Mazini tried to establish a Republican Republic, which was supported by the socialist-utopist Carlo Pisacane. Their ideas became the ideological basement for the Italian republicanism. The second group advocated for a monarchy and was led by Camillo Cavour who would later become Prime Minister of the Kingdom of Italy. Those advocating for monarchy provided a base for conservative right-wing sentiments/ideology.
In the 20th century, there was a divide between fascists and anti-fascists. Those who supported Mussolini espoused conservative views. The anti-fascist coalition united a broad spectrum of political movements including democrats, socialists, and communists.
Today it is impossible to claim that the contemporary Italian Left and Right are descendants of that original opposition, but ideological divides are still a prominent feature of Italian politics.
It would be more correct to divide the Italian parties not only along their preferences of political system but along their attitude toward traditional values as well. Today, political parties on the Right tend to be more nationally oriented and Eurosceptic. They typically advocate for traditional values and greater autonomy from EU Commission directives. They are also staunch opponents of high levels of migration from outside the EU.
The Left is more loyal to the EU and the benefits provided to Italy by its institutions. They also support more progressive economic and family policies. A key difference between left and right in Italy is migration. The left tends to be more tolerant of migrants and refugees and advocate for the integration of migrants into Italian society.
Thus, while the division between the Left and the Right has weakened, it certainly still remains intact. Due to the particularities of the national election law, it is difficult to get the majority of the vote needed and enough seats in the Italian Parliament to form the Cabinet of Ministers. Subsequently, this problem forces the Italian parties to create different coalitions to secure seats in the Parliament. These coalitions are often characterized by the ideology of party members (center-right, right-wing, etc.). This changed in 2013 when a new political party, the 5 Stars Movement, uprooted the traditional political spectrum. Now, there is no pure center-right or center-left coalition. Coalitions have become more volatile as ideological divides become deeper as compared to the situation of ten years ago. For example, the right-wing coalition which included Forza Italia! (S. Berlusconi), Fratelli d’Italia (G. Meloni) and the Northern League (M. Salvini) won the parliamentary elections of 2018. Despite this result, the far-right League abandoned its ideological partners to form a Coalition Cabinet with the Five Stars Movement which cannot be defined as entirely Left or Right-wing.
Recently (in the last decade of the 20th century and the first decade of the 21st century), new collisions emerged: Eurosceptics vs. Eurooptimists, populists vs. traditional political parties, the supporters of migrants vs. opponents of mass immigration (as well as the division between migrants and local communities).
Eurosceptics vs. Eurooptimists
The growth of Euroscepticism in Italy can be attributed to a crisis in relations between the European Union and Italy as well as disappointment from the Italian society in the EU.
Since 1957, Italy has been a strong advocate for greater European integration, however, recently Italy has begun to transform into one of the Euroscepticism centers. According to the sociological data of Eurobarometer, about 50 per cent of the Italian society is disappointed with the European Union.
The question about the relation between Euroscepticism and populism is an intellectual challenge. On the one hand, Eurosceptics are mainly populist movements: not only the anti-immigrant League but also The Five Star Movement. On the other hand, Euroscepticism has been typical for classical Italian communists—the heirs of the Communist party of Italy. Besides, old populism of Berlusconi is more euro-optimistic than the new populism of Salvini.
Particularities of the relations between Italy and the European Union are based on a disagreement in two key issues: immigration policy and the social economic policy.
Populists vs. Traditional Political Parties
One of the results of this political crisis is the growth of social and political populism. Weinstein noted that there are a few approaches to the phenomenon of populism. According to these approaches, a hybrid phenomenon seems to exist in different dimensions: as an ideology, as a specific style of politics, and as a specific form of political organization. The Italian populism started with Silvio Berlusconi coming to power in 1994. Berlusconi is perceived as the founding father of Italian populism, who managed to unite center-right forces. K.G. Kholodkovsky underlines that “populism has in new conditions become a complex of sense and values, uniting many Italians in being connected with the illusion of personalistic overcoming of the gap between authorities and citizens. The breaking of the barriers between the authorities and the people has found its personification in the figure of the uniter of the center-right forces Sylvio Berlusconi” As noted previously, the rise of Berlusconi came against the background of the collapse of Christian Democratic and the Communist parties. This fact reflects an important feature of populism:
- Populism is a consequence of the crisis of the traditional party system, the disappointment with classical parties and party leaders.
- Populism has overcome the traditional division between the Left and the Right.
- Populist parties are often reliant on a strong leader with a distinct character.
Pro-migrants vs. Anti-migrants
The migrant crisis manifested itself most significantly in Southern Italy, since the coast of the Italian South is the closest to the North Africa. From a geographical perspective, this fact has turned the Southern part of Italy (especially the island of Lampedusa) into a gate from Africa to Europe for immigration. The immigration issue is not a new one for Italy. There were several waves of internal migration from the Southern to the more economically developed Northern regions. This process fostered resentment between citizens from different parts of the country. However, the European immigration crises as well as burgeoning crowds transformed this internal cleavage into an external one.
The intensification of the migrant crisis in Italy and in the European Union has been reflected in public opinion. According to Eurobarometer, about half of Italians consider immigration as the most important problem for the European Union, whereas another half of the Italian society cites terrorism as the most important dilemma. This fact also demonstrates that Italians are anxious about the consequences of the immigration crisis, because illegal immigration is one of the factors of the growing terrorist threat. According to the Eurobarometer spring 2016 data, 44% of Italians pointed immigration as the most important problem of the European Union. By autumn 2016, this number rose to 49,1%, by spring 2017—fell to 40%, then in autumn 2017—fell again to 38%, by autumn 2018—rose to 41%.
The growth of anti-immigrant sentiments in the Italian society has led to the emergence of the new nationalism, which is typical not only for the poorer regions but also for the richer ones. The figurehead of new nationalism in Italian politics is the League, formerly the League of the North, which has changed its name to appeal to broader segments of Italian society.
Thus, the migrant crisis has added a new collision between migrants and Italians. The problem of illegal migration became an accelerator of the existing Italian conflicts rather than an entirely new phenomenon. Illegal immigration has essentially accelerated these already-existing Italian conflicts.
Economy and culture are the two principal ingredients of the Italian mindset and are sources of intense socio-political divisions, as economic reasons lead to a rise of new divisions, as well as feeding traditional ones.
Economic crises lead to social and political crises. Nowadays, Italian voters are disillusioned with the existing political order giving way to new and less ideologically driven parties. Yet, these parties’ first years in power have demonstrated their weakness in taking action to overcome the existing crisis.
For example, under Giuseppe Conte’s First Cabinet, known as “yellow-green government of change” (due to the colors of the League and the Five Star Movement), inter-coalition conflict between Salvini and Di Maio led to a significant political crisis, creating a weaker position for the Five Star Movement and the ambitions of the League’s leader Matteo Salvini for domination. On September 5, 2019, Conte’s Second Cabinet was formed, usually referred to as the “yellow-red government”, because it was supported by the “yellow” M5S and the center-left “red” Democratic party.
The internal political situation in Italy remains unstable, which also results in instability of its foreign policy. Irrefutably, the impact of the COVID-19 pandemic has contributed significantly to the Italian political crisis. On February 13, 2021, the dilemma peaked when Prime Minister Guiseppe Conte stated he would resign from office. Pro-European technocrat Mario Draghi became the newest Prime Minister of Italy in the wake of Conte’s resignation. Draghi leads a unity government consisting of mainstream political parties and populist parties such as the League and M5S. This government only failed to garner support of the far-right Brothers of Italy.
Although Draghi has enjoyed widespread support throughout the coronavirus crisis, in the post-covid world there are long-term prospects for conflict between Italy and the EU and between Italy’s internally divided political system.
*Elena Elena, PhD student at the Institute of Socio-Political Research under the Russian Academy of Sciences (ISPR RAS)
From our partner RIAC
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American diplomacy’s comeback and Bulgaria’s institutional trench war
Even though many mainstream media outlets have not noticed it, US diplomacy has staged a gran comeback in the Balkans. The Biden administration chose Bulgaria as the stage on which to reaffirm America’s hold on the region. Putting strong sanctions on Bulgarian oligarch, Washington is signalling not-so subtly to Russia that its reach goes far and wide. But there are sensible implication for the little South-Eastern European country’s future as well. Perhaps, the fight against systemic corruption is finally reaching its apogee. Could this be the end of misgovernance?
A corrupted country — Introduction
Many argue that corruption in Bulgaria and South-Eastern Europe is but a remnant of national Communist Parties’ half-century long rule. Thus, the EU’s threat to metaphorically swap the carrot for the stick should have favoured a thorough clean-up. Instead, it merely yielded some short-term successes for anti-corruption campaigners, activist judges and specialised procurators. Yet, State capture and malpracticesremain endemic for one reason or another amongst post-socialist countries inside and outsidethe Union. More specifically, these efforts were vain and Bulgaria was still ill-equippedwhen it joined the Union on January 1, 2007. Hence, Brussels allowed in a deeply corrupted country where hidden interest behold even those occupying the highest echelons of power.
If not membership in the European Union, at least internal politics could have helped the country fend off endemic maladministration. Yet, the status quo has preserved itself intact despite calls and promises to root out corruption having been getting louder. In a sense, corruption’s pervasiveness is a feature and not a bug embedded in Bulgaria’s imperfect liberal free-market democracy. These conservative – and, in a sense, perverting – forces have found their embodiment in Prime Minister Boyko Borisov and his associates. Therefore, governmental agencies, political parties, courts and the entire extant structure of power contribute to prevent any change.
The wind of change: Popular unrest and institutional trench war
That notwithstanding, the proverbial ‘wind of change’ may have begun to lash across Bulgaria in summer 2020. After having taken to the streets against the party of power’s abuses and failures, voters abandoned Borisov in the April 2021 elections. Conversely, new parties and loose coalitions of civil-society organisations, formed shortly before the contest, won a relative majority of preferences. And, as many analysts noticed, these newcomers do not share much besides the desire to “dismantle the Borisov system”.
Nonetheless, these new actors failed to form a governing coalition due to the heterogeneity and inherent negativity of their agendas. Thus, President Rumen Radev scheduled new elections on July 11 and appointed a caretaker government.
Indeed, there is an institutional custom prescribing such cabinets to limit their activities to managing current affairs. Nonetheless, these technocrats – many of whom supported Radev in his feud with Borisov – started an extensive review of past governments. In the process, the cabinet reshuffledbureaucracies, suspended Sofia airport’s concession and halted other public tenders for suspected irregularities. More importantly, the ministry of interior has confirmed prior suspects that Borisov-appointed officers may have illegally wiretapped opposition politicians.
In a word, President Radev’s ministers are endeavouring to tear apart the ‘Borisov system’ before the next elections. However, simply ousting most – or even all – of the previous government’s men in key positions within State apparatuses is uncomplicated. Especially when pushing such an agenda is the President,with the palpable backing of an absolute majority of the population. But the Borisov system has also an economic component. In fact, the party of power has set up a tentacular network of supportive oligarchs funding and favourable media coverage. Putting them out of the game is equally, if not more, important than firing bureaucrats — but also much more difficult.
Chasing the oligarchs
In other words, undoing the Borisov system’s appointments and putting trustworthy officers in those posts in just the first step. But real change requires leaving the wealthy individuals and organisations benefitting from the status quo clawless and teethless. Such a task entails deep economic transformations that would surely evoke immense opposition from powerful pressure groups. Evidently, there is not enough time before Bulgarians vote again and their representatives pick up a new executive. But the caretaker government is powerless in front of Bulgaria ‘s condemnation to persistent corruption no matter what.
On the contrary, the government has endeavoured to chase and derail some of these Borisov-connected oligarch. For instance, the finance minister appointed an Audit Committee with the task of reviewing the Bulgarian Development Bank’s (BBR) activities. As a result, the public discovered that oligarchs had steered the BBR away from its mandate of supporting small companies. In fact, eight large private companies have received more than half of the BRR’s total credits or ca. €473 million. On average, each of them has borrowed almost €60mln — and “this is not a small and medium business. In addition, these companies borrowed against a 2% rate instead of the average 5–7%. Following this leak, the Minister of Finance fired the entire board of the BBR. He also instructed the Bulgarian National Bank (BNB) to appoint a new directorate.
The US strike back
Quite surprisingly, the United States has just given Radev and his government a valuable assist. On June 2, the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned several “individuals for their extensive roles in corruption”. In first instance, the sanctions target Vasil Bozhkov, a Bulgarian businessman currently hiding in Dubaito escape an arrest warrant for accusation of bribery; Delyan Peevski, prominent figure of and former member of the Parliament for the predominantly Turk Dvizhenie za Prava i Svobodi as well as the owner/controller four of the companies involved in the BBR’s scandal; and Ilko Zhelyazkov, former appointee to the National Bureau for Control on Special Intelligence-Gathering Devices. Secondarily, the US have sanctioned “their networks encompassing 64 entities” with which no transaction in dollars is possible.
The US chose to hit Bulgaria, a NATO ally, with “the single largest action targeting corruption to date”. On the one hand, this falls within the boundaries of the current administration’s effort to restore America’s moral stewardship. More to the point, one may interpret the sanctions as a not-so/veiled message to Russia — which heavily influences Bulgarian politics. Still, those who had been looking at US-Bulgaria bilateral relations should have expected a similar decision. After all, the sanctions came after US ambassador Herro Mustafa’s reiterated criticisms of pervasive corruption in the country. Mustafa has also refused symbolically to meet Chief Public Prosecutor Ivan Geshev, who embodies systemic corruption in Bulgaria.
Consequently, the game has scaled up to a whole new quality now. The BNB barred all Bulgarian banks to entertain commercial relationships with people under US sanctions. Moreover, the BNB had already froze some of Peevvski’s, Bozhkov’s and Zhelyazkov’s deposits, means of payment, and assets earlier. However, after the OFAC’s decision, the block extended to their entire network of affiliates and related entities.
Conclusion: The US are reclaiming the Balkans, and it may not be bad for Bulgarians
Officially, corruption’s malign influence on democracy provides the US with a moral justification to sanction any corrupt individua. Namely, the Treasury argues that it
undermines the values that form an essential foundation of stable, secure, and functioning societies; ha[s] devastating impacts on individuals; weaken[s] democratic institutions; degrade[s] the rule of law; perpetuate[s] violent conflicts; facilitate[s] the activities of dangerous persons; and undermine economic markets.
Surely, the soon-to-come meeting with Russia’s President Vladimir Putin also played a role in this decision.
Yet, the sanctions’ timing suggests that there might be other forces at play. Rather, it seems that Washington decided to pick a side in the ongoing institutional trench war between Presidency and Government.
From Bulgaria’s perspective, even though most American media have not noticed it, the impression is quite clear. To quote President Biden: “America is back, diplomacy is back”. Specifically, this resurgence has a special meaning in the Balkans, a region of immense relevance for Europe’s energy security. Concretely, the US is taking the lead in the West’s effort to keep China, Russia, and Turkey out.
True, whether this external support will suffice for Bulgaria to finally eradicate corruption is debatable. Nevertheless, the US’s return may spur a positive competition dynamic in which Washington and Brussels compete for limited normative power. If this was the case, increase international pressures on Bulgaria to limit corruption may reach a breaking point relatively soon. At which point, either a fundamental shift will take place; or Bulgarian elites will entrench further
Indo-European rapprochement and the competing geopolitics of infrastructure
Current dynamics suggest that the main focus of geopolitics in the coming years will shift towards the Indo-Pacific region. All eyes are on China and its regional initiatives aimed at establishing global dominance. China’s muscle-flexing behavior in the region has taken the form of direct clashes with India along the Line of Actual Control, where India lost at least 20 soldiers last June; interference in Hong Kong’s affairs; an increased presence in the South China Sea; and economic malevolence towards Australia. With this evolving geopolitical complexity, if the EU seeks to keep and increase its global ‘actorness’, it needs to go beyond the initiatives of France and Germany, and to shape its own agenda. At the same time, India is also paying attention to the fact that in today’s fragmented and multipolar world, the power of any aspiring global actor depends on its diversified relationships. In this context, the EU is a useful partner that India can rely on.
Indo-European rapprochement, which attempts to challenge Chinese global expansion, seeks also to enhance multilateral international institutions and to support a rules-based order. Given the fact that India will hold a seat on the UN Security Council in 2021-22 and the G20 presidency in 2022, both parties see an opportunity to move forward on a shared vision of multilateralism. As a normative power, the EU is trying to join forces with New Delhi to promote the rules-based system. Therefore, in order to prevent an ‘all-roads-lead-to-Beijing’ situation and to challenge growing Chinese hegemony, the EU and India need each other.
With this in mind, the EU and India have finally moved towards taking their co-operation to a higher level. Overcoming difficulties in negotiations, which have been suspended since 2013 because of trade-related thorny topics like India’s agricultural protectionism, shows that there is now a different mood in the air.
The Indian prime minister, Narendra Modi, had been scheduled to travel to Portugal for a summit with EU leaders, but the visit cancelled because of the Covid-19 pandemic. As a result, the European Commission and Portugal – in its presidency of the European Council – offered India to hold the summit in a virtual format on 8 May 2021. The talks between these two economic giants were productive and resulted in the Connectivity Partnership, uniting efforts and attention on energy, digital and transportation sectors, offering new opportunities for investors from both sides. Moreover, this new initiative seeks to build joint infrastructure projects around the world mainly investing in third countries. Although both sides have clarified that the new global partnership isn’t designed to compete with China’s Belt and Road Initiative (BRI), the joint initiative to build effective projects across Europe, Asia and Africa, will undoubtedly counter Beijing’s agenda.
The EU and its allies have a common interest in presenting an alternative to the Belt and Road Initiative, which will contain Chinese investment efforts to dominate various regions. Even though the EU is looking to build up its economic ties with China and signed the EU-China Comprehensive Agreement on Investments (CAI) last December, European sanctions imposed on Beijing in response to discrimination against Uighurs and other human rights violations have complicated relations. Moreover, US President Joe Biden has been pushing the EU to take a tougher stance against China and its worldwide initiatives.
This new Indo-European co-operation project, from the point of view of its initiators, will not impose a heavy debt burden on its partners as the Chinese projects do. However, whilst the EU says that both the public and the private sectors will be involved, it’s not clear where the funds will come from for these projects. The US and the EU have consistently been against the Chinese model of providing infrastructure support for developing nations, by which Beijing offers assistance via expensive projects that the host country ends up not being able to afford. India, Australia, the EU, the US and Japan have already started their own initiatives to counterbalance China’s. This includes ‘The Three Seas Initiative’ in the Central and Eastern European region, aimed at reducing its dependence on Chinese investments and Russian gas. Other successful examples are Japan’s ‘Expanded Partnership for Quality Infrastructure’ and its ‘Free and Open Indo-Pacific Strategy’. One of the joint examples of Indo-Japanese co-operation is the development of infrastructure projects in Sri Lanka, Myanmar and Bangladesh. The partners had been scheduled to build Colombo’s East Container Terminal but the Sri Lankans suddenly pulled out just before signing last year. Another competing regional strategy is the Asia-Africa Growth Corridor (AAGC), initiated by India, Japan and a few African countries in 2017. This Indo-Japanese collaboration aims to develop infrastructure in Africa, enhanced by digital connectivity, which would make the Indo-Pacific Region free and open. The AAGC gives priority to development projects in health and pharmaceuticals, agriculture, and disaster management.
Undoubtably, this evolving infrastructure-building competition may solve the problems of many underdeveloped or developing countries if their leaderships act wisely. The newly adopted Indo-European Connectivity Partnership promises new prospects for Eastern Europe and especially for the fragile democracies of Armenia and Georgia.
The statement of the Indian ambassador to Tehran in March of this year, to connect Eastern and Northern Europe via Armenia and Georgia, paves the way for necessary dialogue on this matter. Being sandwiched between Russia and Turkey and at the same time being ideally located between Europe and India, Armenia and Georgia are well-placed to take advantage of the possible opportunities of the Indo-European Partnership. The involvement of Tbilisi and Yerevan in this project can enhance the economic attractiveness of these countries, which will increase their economic security and will make this region less vulnerable vis-à-vis Russo-Turkish interventions.
The EU and India need to decide if they want to be decision-makers or decision-takers. Strong co-operation would help both become global agenda shapers. In case these two actors fail to find a common roadmap for promoting rules-based architecture and to become competitive infrastructure providers, it would be to the benefit of the US and China, which would impose their priorities on others, including the EU and India.
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