Italy as Part of Russia-EU dialogue

After almost three months of consultations, Italy has its "yellow-green" government (the colors of the logos of the Five Star Movement and the League parties). For the first time ever, the government now includes Five Star representatives, who had previously been "barred" from ministerial seats. Eventually, the post of the Prime Minister was taken by Giuseppe Conte, a compromise figure originally advanced by the Five Stars and supported by the League, and later the country’s president.

Six months ago one could hardly imagine such a union of left-wing populists (the Five Star Movement) and center-right League which is Silvio Berlusconi’s traditional ally. Nevertheless, on the foreign policy agenda, both parties share a certain degree of Euroscepticism (the parties have repeatedly stated the need to hold a referendum on Italy’s membership in the euro area) and sympathy for Russia. In this regard, a question arises as to whether the new Italian government led by Giuseppe Conte is really going to push for easing EU sanctions against Russia.

Since the 1990s, Italy has been quite comfortable trying on the role of mediator in Russia-Europe relations. Such a position is reflected in the country’s strategic interests, which are primarily related to security (both national and energy) and economic growth. According to the Italians, achieving these goals is impossible without Russia, which is part of the European security system and provides great potential for promoting economic cooperation.

It can be safely stated that Italy is leaning toward a strategy of involving Russia in European affairs, rather than containing it. So, it was Italy that facilitated Russia's full G8 membership, the establishment of the Russia-NATO Council, and refused to harshly criticize Russia during the "five-day war" in 2008.

However, this does not imply that the parties agree on all issues (this implication didn’t exist even during Berlusconi's tenure as prime minister), but Italy insists on constructive cooperation and dialogue with Moscow, both on the part of the EU and NATO.

At the same time, the need to abide by the principles of Europeanism and Atlanticism in its foreign policy limits the room for political manoeuvres. Hence, in the current political circumstances Italy is forced to display diplomatic flexibility in its dealings with both Europe and Russia.

In the days after the new government was sworn in, the new leaders confirmed the main constants of the country's foreign policy. "We remain members of NATO and allies of the United States, but we are also engaged in a dialogue with other countries, including Russia, as we have been," said Deputy Prime Minister and Minister of Economic Development, Labour and Social Policies Di Maio at a meeting with Leonardo's management (Italy's major industrial holding company, formerly known as Finmeccanica). This statement followed a certain controversy surrounding the European sanctions. Di Maio added that Italy is bound by agreements with the United States and the country will guarantee the continuity of earlier signed agreements and commitments.

Last week the political situation in Italy changed with the kaleidoscopic speed, which disarmed anyone who was trying to predict further developments. In the best Machiavellian traditions, the main actors of the Italian political play (even called by the media as a “collective psychodrama”) easily denied what they had said the day before, contested themselves and others, attacked and retreated, accused and repented.

In his remarks at the Palazzo Montecitorio, Prime Minister Conte confirmed his loyalty to the Alliance ("We are in NATO and we want to stay there."). However, speaking in the Senate the day before, the prime minister reaffirmed the new government's focus on lifting the sanctions on Russia as stipulated in the so-called government contract of the League and the Five Star Movement. At the same time, Brussels and Rome say the sanctions are a signal with an economic dimension. The main requirement of the European partners is compliance with the Minsk agreements (not the legal status of the Crimean Peninsula).

Today, the Italian government is ready to act as a mediator again and to send messages to Brussels about the need to discuss the anti-Russia measures and, possibly, to soften them. But if Italy moves to become too pro-Russian, the country risks incurring reputational losses. The European and Atlantic directions remain of primary importance for Italy.

In their desire to cooperate with Russia, the Italians are coming up with new forms of interaction. For example, the Italian Embassy in Russia proposed a concept "Made with Italy" (which implies localizing production in Russia with the involvement of Italian technology), which is currently being successfully implemented. Given the circumstances, Vittorio Torrembini, Vice-President of the Association of Italian Entrepreneurs in Russia, has offered four types of cooperation between Russia and Italy. The first, the "Lipetsk model," involves transferring the production capacity of a foreign company into a special economic zone in Russia. The second option is the "Chelyabinsk model" which involves creating joint ventures with a local partner that enjoys a large share on the Russian market, such as cooperation between the firms at the KONAR industrial park and Transneft. The third option provides for direct investment, which serves as an "incubator" for building new enterprises (primarily, small- and medium-sized businesses) and services. The fourth model includes investment in upgrading and specializing Russian companies. According to Mr. Torrembini, the agro-industrial complex, the construction materials market and construction, electrical engineering and electromechanics, machine tools and industrial components, chemistry and petrochemistry, as well as the pharmaceutical industry are the most promising areas of cooperation. He also pointed out the need to create new cooperation formats, in particular, dialogues and working groups with relevant ministries, so that Italian entrepreneurs can learn more about the opportunities for doing business in Russia, and the sectors and regions where their presence would be most lucrative.

Thus, Russia-Italy relations continue to improve despite the damage caused by the sanctions. The country is succeeding in finding a balance between national interests and the need to comply with its commitments to its EU and NATO partners. However, Italy has played and continues to play a constructive role in Russia-EU relations. The further strengthening of relations between our countries is quite possible, but the possibility of a change in EU policy because of Italy’s position is unlikely.

In the current circumstances, the best foreign policy for Italy is to continue its chosen course which is to prevent a deterioration in relations between Russia and the EU while supporting EU and NATO common policy.

Views expressed are of individual Members and Contributors, rather than the Club's, unless explicitly stated otherwise.