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Why Italy Needs to Enhance Its Strategic Vision

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Modern Diplomacy meets the Italian Undersecretary for Defense Raffaele Volpi. Mr. Volpi, a senior official of the ruling Italian party “Lega”, is an authoritative voice inside the party and is highly respected by its Leader, Deputy Prime Minister and Interior Minister, Matteo Salvini.

In this brief conversation, we will talk about the future challenges that the Italian Armed Forces will have to face in the near future, the political and industrial effects on defense stemming from the Franco-German Treaty of Aachen, and concluding with reasons why Italy needs a strong strategic system that supports its key defense industries.

What are the financial challenges that the Italian armed forces will have to face in order to maintain their efficiency and advanced operations?

The operational capacity of the Armed Forces must inevitably be linked to what are strategic choices. Today, no country can think of doing everything, except perhaps the three major global powers of the United States, China, and Russia. Therefore, each country must have the opportunity, together with allies, to choose what its key strategic missions are and allocate its resources accordingly.

Making this more difficult is that no mission is the same: obviously, capacity on preserving and security national territory must remain primary. So, the bigger question remains in terms of choosing what other perspectives do we need to focus on and how do we link these choices back to the main objective, which is ultimately about how to positively and productively project our power. One must know how to choose and it is not simply a financial issue.

Let me give an example: there is a huge demand from the international community for a renewed commitment from Italy in the Mediterranean. Well, looking at the Mediterranean and the northern part of the African continent means choosing how we want to be present in the area in an intelligent and strategic way. This is not a talk about war: we are talking about power projection. Therefore, resource acquisition and allocation is key. Surely, as in all countries, resources are infinite or limitless. Therefore, very careful planning must be done: we must move beyond mere posturing, as we tend to say in diplomacy, and move on to mutual respect. We must make strategic, even geo-strategic, choices that align to effective programming.

Do you look favorably upon the development of a common European defense? If so, what role will Italy have to play, taking into account the French power of nuclear deterrence and the signing of the French-German Treaty of Aachen?

A common defense is an interesting idea. It is part of amore complex idea that can be called Euro-Atlantic, which would be a capable, strong, and authoritative Europe within a greater Atlantic Alliance. Europe needs to understand what it wants to become at a strategic level, looking both historically at organizations like NATO, which looks mainly toward Russia as the primary challenge, and how NATO itself has recognized the need to look beyond Russia, towards a southern front. This is the new front of concern for the Mediterranean, both from an ISIS standpoint and other extremist groups and also in terms of problematic immigration/refugee challenges.

The idea of Europe at this time needs to definitely be rebuilt, with the treaty of Aachen revealing the possibility of introducing the nuclear element. I do not have the impression that France and Germany are becoming closer friends. Ironically, this is shown by the need to make a treaty every few years. Behind this constant treaty-making is also the conditioning to think about the US commitment in Europe, especially on the issue of a nuclear umbrella. From the Obama administration to present day, there has been the strategic retreat of the United States, at least in concept if not yet fully implemented, from many international commitments.

Personally, I have as a secondary thought that this French-German agreement in Aachen also serves to guarantee its own possible nuclear coverage. I think the United States will not leave Europe because the alliance is too strategic for it, and not just from a military point of view. There is, however, an important aspect that France and Germany, regardless of any treaty, are already doing when it comes to their philosophy about a common defense and the joint defense project that is the construction of a common military tank. If Europe wants to be authoritative, then it must make decisions that lead to a more definitive foreign policy. We must have more aligned common goals, both diplomatically and militarily.

From an industrial point of view, what effects will this Franco-German understanding have on Italy’s defense industry?

There are difficulties in other countries. For example, Germany has an internal difficulty in having strong investments in defense, especially when they are juxtaposed against the new political and social composition of the country.Thus, concerns and perceptions can never be purely or exclusively focused on industrial development. The world of defense, not only in Europe but on a global level, is a very competitive world. It is a world that cannot be read in newspapers where, for example, two companies from different countries are allied to bring a product forward in one country smoothly while in other situations these companies and countries are competitors.

Ours is a country that ranks seventh overall in size of defense industry, so we have a capacity that derives from two factors:

First, is our talented and highly-skilled defense workforce, our people, that are incomparable. Unlike technology that can be copied, knowing how to work effectively, THIS cannot be copied.

Second, is our huge technological capacity. We have national champions that are not necessarily the largest companies, but are small and medium-sized companies that develop excellent products and are in demand all over the world.

Creating a more cohesive European defense industry could enable us to be more competitive. But I believe that this is not the chief problem. Our problem is different. Italy needs a defense system that is strong and coordinated, which focuses above all on the information communication/technology part. This brings the possibility of being aggressive in some key markets, while also having the ability to continuously monitor all the actors moving within and across these markets. We still lack such a system and this must be the challenge we address over the next few years for the defense and security industries as a whole. We are capable of having great products but we must learn to run together.

I think that in life you have to be able to always learn and see how other systems work. We have very aggressive competitors. France, first of all, with its tried and tested system, that allows its defense industries to be massively supported by government, intelligence infrastructure, design development, and further incentives. However, when I say this, we are also talking about nothing extraordinary, except the commitment to offer aid that is available to the French defense industry every day, twenty-four hours a day. Our government must realize that same set of guarantees for our national security industry.

To face increasingly competitive foreign groups, how do you view the potential creation of a national champion through the alliance of Leonardo and Fincantieri?

I do not see a need for it. I think there must be moments of important confrontation between groups. It is not necessary to create a super national champion. The important thing is to work together, to have the ability to relate, thanks to a strong and cohesive Italian system with other major international players such as Boeing, Lockheed, and Airbus. The defense industry is a projection industry, as in imagining what competitive challenges will be emerging in the future. It is now wise to project thirty years forward with accuracy, so a strong systemic national security industry means it can also be an effective competitor/partner with other global companies.

There is one aspect that we must always remember: the defense industry is a sector that concerns national security and national interests, so you cannot choose wrong in terms of alliances. Those choices are best guaranteed when both the future of technology AND geopolitics are taken fully into account. It is important that political choices are made in a very serious manner, strictly linked with national interest. Our national interest comes to us from history: from my point of view, this is chiefly an Atlantic Alliance with a strong Europe at its center.

Are you in favor of the development of nuclear energy for military purposes in Italy?

I believe that Italy has a complementary opportunity compared to what the general choices of the Alliance can be. We have a strategic unique position and have a capacity for multilateral dialogue that other countries do not have. So our form of deterrence is where we are and with whom we talk. Our strength is a calm, reasoning force with respect for sensitivities that is not common even to our allies. This is because we are a country within the Mediterranean region that has a unique capability to have relationships with everyone, even in the most difficult moments. So, nuclear power exists, it will persist and remain, even though it tends to be a rather blunt instrument. We, on the other hand, must play the card of “Italianness” within the geopolitical context with the strategic deftness it deserves.

Co-author: O. Rafaggio

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American diplomacy’s comeback and Bulgaria’s institutional trench war

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Official White House Photo by Adam Schultz

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.

Political reconfigurations

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

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Indo-European rapprochement and the competing geopolitics of infrastructure

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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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The Leaders of the Western World Meet

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The annual meeting of the G7 comprising the largest western economies plus Japan is being hosted this year by the United Kingdom.  Boris Johnson, the UK Prime Minister has also invited Australia, South Korea, South Africa and India.  There has been talk of including Russia again but Britain threatened a veto.  Russia, which had been a member from 1997, was suspended in 2014 following the Crimea annexation.  

Cornwall in the extreme southwest of England has a rugged beauty enjoyed by tourists, and is a contrast to the green undulating softness of its neighbor Devon.  St. Ives is on Cornwall’s sheltered northern coast and it is the venue for the G7 meeting (August 11-13) this year.  It offers beautiful beaches and ice-cold seas.

France, Germany. Italy, UK, US, Japan and Canada.  What do the rich talk about?  Items on the agenda this year including pandemics (fear thereof) and in particular zoonotic diseases where infection spreads from non-human animals to humans.  Johnson has proposed a network of research labs to deal with the problem.  As a worldwide network it will include the design of a global early-warning system and will also establish protocols to deal with future health emergencies.

The important topic of climate change is of particular interest to Boris Johnson because Britain is hosting COP26  in Glasgow later this year in November.  Coal, one of the worst pollutants, has to be phased out and poorer countries will need help to step up and tackle not just the use of cheap coal but climate change and pollution in general.  The G7 countries’ GDP taken together comprises about half of total world output, and climate change has the potential of becoming an existential problem for all on earth.  And help from them to poorer countries is essential for these to be able to increase climate action efforts.

The G7 members are also concerned about large multinationals taking advantage of differing tax laws in the member countries.  Thus the proposal for a uniform 15 percent minimum tax.  There is some dispute as to whether the rate is too low.

America is back according to Joe Biden signalling a shift away from Donald Trump’s unilateralism.  But America is also not the sole driver of the world economy:  China is a real competitor and the European Union in toto is larger.  In a multilateral world, Trump charging ahead on his own made the US risible.  He also got nowhere as the world’s powers one by one distanced themselves.

Secretary of the Treasury Janet Yellen is also endorsing close coordination in economic policies plus continued support as the world struggles to recover after the corona epidemic.  India for example, has over 27 million confirmed cases, the largest number in Asia.  A dying first wave shattered hopes when a second much larger one hit — its devastation worsened by a shortage of hospital beds, oxygen cylinders and other medicines in the severely hit regions.  On April 30, 2021, India became the first country to report over 400,000 new cases in a single 24 hour period.

It is an interdependent world where atavistic self-interest is no longer a solution to its problems.

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