After Italian Prime Minister Matteo Renzi’s diplomatic visit to Moscow, the obvious question becomes: Why exactly is Italy seeking to restore relations with the Kremlin?
Russian President Vladimir Putin (right) and Italian Prime Minister Matteo Renzi to make a joint press statement on the results of their Kremlin meeting, March 5, 2015. Photo: RIA Novosti
The visit of Italian Prime Minister Matteo Renzi to Moscow indicates the significance that the present Italian government attaches to relations with Russia. It represents the first full-fledged official visit by a European leader to Russia since the outbreak of the Ukraine crisis.
According to Russian media, “The only other visit paid to Vladimir Putin was by French President Francois Hollande on his way back from Astana, but even then he chose not to leave the building of Vnukovo airport, spending only a few hours in Russia.” The Kremlin talks between Putin, Hollande and German Chancellor Angela Merkel cannot be described as an official state visit. It was more a case of shuttle diplomacy ahead of the “Normandy Four” meeting in Minsk.
In this context, Renzi’s visit suggests that European leaders are taking steps to break Russia’s isolation from the West.
Renzi’s ascent to power
It is worth noting that the visit occurred just a few weeks after Italy marked the first anniversary of the Renzi cabinet’s tenure in office. Over the past year, Italy’s ambitious 40-year-old prime minister has undertaken a series of internal reforms, not least the reorganization of the role and method of electing the Senate, the upper house of the Italian parliament.
Alongside wide-ranging political reforms, the authorities set about restructuring the national labor market to increase competitiveness and, at the same time, simplifying the procedure for companies to lay off workers. Changes were also made in the administrative and judicial spheres, and in education.
It is still too early to talk about the effect of Renzi’s reforms. But Italy’s head of government enjoys considerable personal authority among the Italian public, as evidenced by the success of Renzi’s center-left Democratic Party (DP) in the May elections to the European Parliament and victory in the partial regional elections held in 2014.
Clearly, today Renzi feels far more confident in the prime minister’s seat than in February 2014, when he was sworn in as chairman of the Italian Council of Ministers.
Rome’s foreign policy
The twelve months since Renzi became chairman of Italy’s Council of Ministers will also be remembered for Rome’s more active stance in foreign policy. Italy has begun to assert itself more in the EU. Renzi stood side by side French President Francois Hollande in calling for the EU’s “policy of austerity” to be replaced by a policy of economic growth. Renzi can also claim as a diplomatic victory the appointment of DP colleague Federica Mogherini as the new EU high representative for foreign affairs and security policy.
U.S.-Italian relations are also on the move. Some observers attribute this to the fact that the political views of Matteo Renzi and Barack Obama largely coincide. Italy’s Democratic Party is closely aligned with America’s, and both parties play an important role in the Progressive Alliance, an international center-left association.
2014 also showed that Italy is keen to develop fruitful economic ties with the Asian giants, primarily China and Japan. Italian-Turkish relations also have tremendous potential, not least because Renzi openly supports Turkey’s accession to the European Union.
Moreover, Italian politicians are greatly alarmed by the situation in the “Greater Middle East.” Rome supported the Egyptian Air Force’s recent bombing of Islamic State (IS) positions in Libya. Italian diplomacy favors involving as many countries as possible in the fight against IS in the Middle East, but of particular concern to Rome is the growing chaos surrounding the situation in Libya, from where thousands of illegal immigrants are ferried to the Apennines each month.
Italy’s relations with Russia
As for Italy’s relations with the Russian Federation, they are, of course, a long way from the coziness that existed between Rome and Moscow under Conservative leader Silvio Berlusconi. However, the Renzi cabinet concurs that Russia remains a “strategic partner,” even if Renzi’s Italy did not recognize the legitimacy of the Crimean referendum. In addition, Italy supported Russia’s ejection from the G8, and readily joined the anti-Russian sanctions.
But today a growing number of senior Italian politicians, including members of the government, understand that there is simply no alternative to restoring top-level bilateral relations between Italy and Russia.
After all, when Renzi came to power, Russia was Italy’s sixth largest foreign trade partner, providing 6 percent of all imports. The overall volume of trade between the two countries remains very high: €48 billion (approximately $52 billion) per year. Italy is generally considered to be the second largest consumer of Russian exports.
But the other direction is important too: Italy is Russia’s fifth-largest foreign trade partner. Russia supplies energy (15 percent of Russian oil and 30 percent of gas is exported to Italy), ferrous and nonferrous metals and timber, while Italy delivers manufactured goods, machinery, chemical products, consumer wares and textile fabrics to Russia.
The numerous examples of successful economic cooperation are no accident. About 500 Italian firms have representative offices in Russia. Italian economic giants, such as ENF, ENEL and Saipem, are very active in Russia. Russia’s Sukhoi and the Italian company Alenia are jointly developing the new Superjet 100, the major Italian bank UniCredit recently entered the Russian market, and plants to produce washing machines in Lipetsk and ceramic tiles near Moscow have been set up with Italian partners.
Normalized cooperation between Russia and Italy could also reap rewards in the fields of culture, education, science and high tech. All these examples clearly illustrate the huge potential of bilateral ties, which will no doubt survive the present blip in international relations.
Renzi’s options for restoring ties with Russia
The question arises as to the new format of cooperation between Moscow and Rome in opposition to the jihadist threat in the Middle East, particularly Libya, a former Italian colony. According to business daily Vedomosti, the post-Gaddafi chaos and ongoing military crisis have hit supplies of oil (20 percent of which goes to Italy) and gas (10 percent), creating problems for Italy’s gas giant Eni, which operates some large projects in Libya.
Another challenge is the influx of Libyan refugees seeking asylum in Italy: Rome fears that IS terrorists could enter the country under this guise. Cooperation with Russia in the field of security and counter-terrorism is a priority in that regard.
Both Russia and Italy are clearly suffering direct losses from the “sanctions wars.” Both producers and society at large have a stake in restoring bilateral trade. However, as some Russian media note, that can only happen if the Kremlin helps secure de-escalation in Ukraine. Only then will Rome be able to argue in favor of lifting the sanctions against Moscow. It is very much in Italy’s interests to do so, since the country’s agribusiness has been badly hurt by Russian counter-sanctions.