COVID-19 Pandemic and How It Affected Sino-Italian Relations

Abstract

Italy was the most affected European country at the beginning of the COVID-19 pandemic. While the European Union was struggling to get its act together and provide assistance to an ally in need, Russia and China used the opportunity to promote their own agendas. The focus of this article is on the economic and social impact of the COVID-19 pandemic on Italy, China’s disinformation campaign, and the uncertain future of the relations between the two countries.

Italy has suffered more than any other European country from the COVID-19 pandemic. The health and economic catastrophe was only made worse by the perceived initial weak response by European institutions. 1 It created an opening for China to promote a massive campaign – to over promising its assistance to undermine trust in the Europen Union (EU). At the pandemic’s beginning, then, it appeared that the Italian public held a favorable view of Beijing. Yet, after an extremely difficult year, 2021 saw Italy endure a paralyzing political crisis that led to the creation of a technical government led by Mario Draghi, the world-renowned economist and former President of the European Central Bank. A year later, in September 2022, a new political election brought a new government to power led by Giorgia Meloni, the leader of Fratelli d’Italia. Meloni, the first women prime minister in Italy, spearheaded a government that strongly aligned with its European and transatlantic allies.

Italy: The First European Country to Get Hit by COVID-19

In early March 2020, the World Health Organization (WHO) officially declared COVID-19 a global pandemic. 2 Italy was at the forefront of the outbreak, with the second-largest number of confirmed cases after China. The Italian epidemic quickly reached alarming levels, posing a serious threat to the national health care system. As of March 15, 2020, Italy was one of the top virus-affected countries in Europe, with a recorded toll of 23,642,011 infected people, according to the Johns Hopkins University 3 Coronavirus Research Center, and a troubling death rate of nearly four percent. 4 After three weeks, most of the other European countries experienced similar cases and fatalities. This forced EU- member states to apply restrictions to all sectors to mitigate the health crisis, albeit with severe social and economic consequences. As of April 2021, Italy experienced the worst trend in COVID-19, in all of Europe. Since the pandemic’s beginning, Italy had almost 24 million confirmed COVID-19 cases and almost 180,000 fatalities. 5 Italy ranked 8th for the number of total infections and 6th in the number of deaths globally. 6 Moreover, its mortality rate of 3.03 percent was among the highest registered in the EU, compared to other European countries. 7 As a result of high vaccination rates, almost 85 percent of the population, and the less aggressive COVID-19 variants, Italy has successfully overcome the difficult phase of the pandemic, but the negative spillover economic and social consequences will last longer.Tables 1 and 2.

Table 1.

Table 2.

Economic and Social Consequences of COVID-19 pandemic

The spread of the COVID-19 virus has caused an unpredictable market shock in Italy, both on demand and supply, amid the progressive shutdown of national economic activities necessary to stem the epidemic. Even before the COVID-19 crisis, Italy faced stagnant incomes, with the same average per capita income lower than as 20 years earlier. In 2020, the Italian economy suffered a contraction of 9 percent negative growth rate, 8 and a sovereign debt worth 155 percent of GDP. Almost 55 percent of Italians considered the economic crisis the biggest threat for the country, compared to 22 percent who viewed the virus as the main challenge.

With overall unemployment rates at 10 percent, and youth unemployment at 31 percent, 9 the real adverse effects on the labor market will be felt in the future because of the short-term measures introduced by the Italian government (short-time programs, suspension of layoffs), and the lagged time effect on unemployment. As soon as the safety nets end, the actual effects will appear, especially since many issues are structural. Youth unemployment in Italy was the highest in 2014 (after the double recession), with almost 43 percent. In the last decade, absolute poverty rates for young people have risen sharply, and large regional (north and south) differences in incomes and employment have spiked over the crises. 10

According to International Monetary Fund (IMF) data, Italy is the only G7 country that has seen worsening living standards. In 2022, real per capita income of average Italians was less than USD 34,000 as compared to USD 41,000 in 2008 During the same period, the average real per capita incomes of EU citizens have risen by at least 25 percent.

Since 2008, Italy has suffered a triple recession (2008–2009; 2012–2013, and 2020–2021). It would be a mistake to claim Italy’s woes are simply the result of the pandemic. The current crisis—which is deeper and fundamentally different from the recession of 2008–2009—is revealing the deep-rooted structural problems of the Italian economy’s decades-long economic underperformance brought about by poor strategic planning at the macro level.

Since 2000, the average economic growth rate in Italy has been negative 0.15 percent, with the highest growth rate of 3.78 percent in 2000, and the lowest of - 5.28 percent in 2009, to - 9 percent in 2020.

How Did We Get Here?

Before the introduction of the Euro, the Italian economic model was mainly based on exports. The Italian companies were competitive in the international market representing the high quality “Made in Italy” brand that incorporated a mixture of Italian design with innovative modern technology and competitive prices (devaluation of the lira). Unprepared for the Euro, and without a long-term strategy to guide government industrial policy and investments needed to maintain and increase productivity and competitiveness, Italian companies failed to adapt. At the time, business leaders saw the easiest way to stay competitive was to focus on reducing production costs. This led to an over-reliance on imports of semi-finished products (thanks to a strong Euro) and offshoring production to countries with cheap labor costs (thus starting the internalization process). The Italian industrial base changed as a result, putting at risk the small and medium enterprises, the economy’s lifeblood. With the transfer of industrial production to emerging economies, Italy witnessed a voluntary de-industrialization. 11 The skills and capacities accumulated over time atrophied rapidly. The offshoring of Italian companies and the policies of cost-reduction, focused mainly on the labor costs, not only increased unemployment but also reduced the purchasing power of the Italian workers. This situation had an immediate and direct impact on the middle class and began to widen social inequalities.

Another critical factor was the unstructured liberalization of the labor market, which started in the early 2000s (Pact for Italy-Labor Contract 12). It continued after the eurozone crisis with the “Jobs Act” 13 to complete a deregulation process, which caused fragmentation of employment relationships. 14 Immigration, especially the informal one, has also played an important role in the under- performing economy. Italy ranks third in the EU for the number of immigrants. Considering that the informal economy in Italy makes up at least 12 percent of the GDP, 15 the undeclared work and underemployment of immigrant workers generated additional negative effects for the incomes. 16

After the Eurozone crisis and the resulting credit crunch, consumption, investment, and confidence in the economy suffered. While these challenges became more visible to policymakers, they, unfortunately, did not translate into any concrete actions aimed at making things better for the average Italian.

While Italians tend to blame the Euro and the European Union for the current economic crisis, the lack of economic solidarity and paralyzing structural problems that led to weak productivity are the main factors holding Italy back economically. 17 Unfortunately, political distraction and deflection of responsibility have conveniently painted the EU as the guilty party. While almost 50 percent of Italians have bought into this argument, leaving the EU would not solve the issues. 18 The scapegoating game is no solution—it only postpones the absolute requirement to make hard choices.

The sluggish productivity growth rate, mainly in labor productivity, explains the disappointing performance of the Italian economy since the mid-1990s. 19 In 2017, Italy’s labor productivity growth rate was only 0.6 percent compared to OECD’s 1.5 percent. 20 By comparison, Germany’s rate is 1.7 percent. Since 2000, the average productivity rate has barely increased with less than 0.2 percent per year, well below European averages. Similarly, the GDP per hour worked is 100.5 compared to OECD’s 104. 21

Italy’s structural issues that affect the competitiveness of the business environment range from excessive bureaucratic procedures, slow justice times, high levels of taxation, pervasive tax evasion, and a robust informal economy—complicated by significant regional disparities. High public debt and excessive interest rates have created macroeconomic issues that need urgent attention. The misallocation of resources, low public investment, and the poor performance of many public institutions are directly responsible for declines in both innovation and the knowledge economy. Economic and governance reforms are needed to promote a leaner and more transparent public sector and increase productivity growth. These efforts need to be carried out in conjunction with changes in the education system designed to recapture the lost concepts of innovation and business dynamics.

Chinese Disinformation Campaign in Italy

The pandemic and its negative repercussions on the economy have created ample opportunities to influence operations from external players. Various governments, including Russia and China, have targeted the EU and the wider neighborhood with disinformation 22 and conspiracy theories.

In Italy, and more broadly in Europe, the pandemic crisis has been accompanied by massive geopolitical disinformation campaigns from external players. The primary purpose of these campaigns is shifting the “narrative” of the pandemic and undermining trust in European institutions and democracy. China’s communication efforts toward the EU primarily aimed to shift the narrative about China from “the country where the virus originated” to “the country that came to the rescue of other nations.” As China’s interests were strongly fostering “pro-China” feelings in historically “pro-EU” countries, perceptions of China among EU states continued to diverge, putting the foundations of security and the solidarity in Europe at risk. In June 2020, the European Commission denounced Chinese (and Russian) attempts to influence EU citizens and debate during the virus outbreak with a global engagement in disinformation campaigns. 23 Moreover, the EU Foreign Affair Chief Joseph Borrell stated that the EU “doesn’t have the resources nor the authority to effectively counter hybrid attacks coming from China.” 24

A report of the Italian parliamentary committee for security (Copasir) has certified that a strong “info-demic” existed during the COVID-19 crisis, 25 and specified the role of Russian and Chinese propaganda in the country. Foreign state actors, at the epicenter of online disinformation activities, have aimed to manipulate Italy’s internal political debate, mislead the public, and influence international geopolitical balances.

Italy was the first country in Europe to receive Chinese aid in the form of masks, ventilators, and specialized medical personnel. This assistance was over-magnified in a public diplomacy and social media campaign designed to celebrate the “special relationship” between China and Italy 26 as a Belt and Road Initiative member. The truth is that what was covered in the media as Chinese aid, including large quantities of medical materials, were in fact paid for by the Italian Civil Protection Department. 27 The department partnered with the Support Structure to the Extraordinary Commissioner for Emergency COVID-19, and made available with the contribution of national agencies and foundations. 28

To bolster its success, Beijing exploited popular dissatisfaction in Italy with the EU’s initial confusion in handling the crisis. This, coupled with lingering sentiments around the 2008 financial crisis and the subsequent austerity measures, and the perceived lack of European support during the 2015–2016 immigration crisis, led to an anti-European feeling that became a feature in social media through the hashtag #Italexit. 29 The entire campaign aimed to shift public opinion to be more favorable to China, incite people by stirring patriotic sentiments and highlighting biases against the EU and the United States. The goal was to foster an anti-establishment narrative affecting EU cohesion and transatlantic unity (Italy-U.S. relations). A combination of methods was cleverly used for this purpose. 30 Efforts included the “manipulation” of economic cooperation to dominate the narrative, 31 the instrumentalizing the Chinese diaspora 32 and philanthropic institutions, 33 giving rise to “mask diplomacy.” 34 Throughout the diplomatic and social media campaigns, 35 China was portrayed as a friend and savior while using messages to mount animosity toward Italy’s traditional allies. In a clumsy effort, China’s state-owned website Global Times even tried to blame the disease on the Italians during the first days of the crisis. 36 The novelty was the remarkable presence in the media of the Chinese Ambassador in Italy, 37 with the Chinese Embassy in Rome maintaining a very active Twitter feed. 38

Through these efforts, the narrative of China’s supposedly superior model of governance prevailed among the Italian audience, while several Italian commentators and politicians on mainstream media stirred up a widespread feeling of gratitude. More disturbingly, the efforts at narrative-shaping mobilized thousands of pro-Chinese bots on Twitter.

Beijing’s strategy to increase its public engagement in Italy did not start with the pandemic but with Italy’s decision to join the Belt and Road Initiative (BRI) in March 2019. 39 Italy has been among the main targets of Beijing’s propaganda in the EU, with specifically tailored messages meant for Italian audiences. The peninsula represents a crucial player for China to achieve its BRI objectives and its geo-economic and political interests in Europe, although trade and investment for the Italian business community have been disappointing. 40 Italy also represents opportunities for Chinese companies in the current economic crisis, 41 a remake of what happened after the Eurozone crisis. At that time, China’s acquisitions of Italian enterprises skyrocketed. This time things might get worse, and the playing field is being prepared during the pandemic.

Beijing’s Narratives: Well Played?

The last few months have presented an invaluable test for crisis communication and a real learning platform for Italy. Some Italian politicians have raised the issue that the Italian government and citizens were unprepared to deal with this style of propaganda, and Chinese social media literacy. 42 In the initial phases of the pandemic, Italian public opinion polls expressed a favorable view toward China. in the world.Beijing was seen as the main actor in the fight against the virus alongside Italy. It was an impressive increase in public support compared to a year earlier when the United States held the spot as the privileged partner. About 58 percent of the Italians viewed China as an actor with increased influence. 43

By the end of 2020, attitudes appeared to have changed. More than half of the Italians considered Chinese aid during the pandemic as an attempt at political influence in the country, 44 while 62 percent of Italians have a negative opinion and only 38 % a positive one. Furthermore, e, 75 percent of the public has lost faith in President Xi Jinping, 45 compared to 54 percent in 2019.

A recent survey of the German Marshall Fund on Transatlantic Trends 46 shows that only 25 percent of Italians consider China as partner, compared to 34 percent that view it as a competitor and 17 percent as a rival. The remaining 25 percent are still undecided. These findings track with average European perceptions.

It seems that China’s misinformation campaign smashed the Italian government’s enthusiasm toward Beijing. As a result, its efforts raised the level of media criticism about the Chinese tools to gain influence. On the diplomatic front, the fiftieth anniversary of the opening of diplomatic relations with the People’s Republic, which took place in November 2020, was subdued in the media. Concerns about human rights violations from Beijing, especially concerning Hong Kong, have become more openly criticized in the media, raising awareness in the Italian public.

China-Italy Economic Relations: Reality vs. Expectations

Italy is a source of strategic assets in both advanced and traditional industries and internationally recognized brands and technology and occupies a crucial geographic position in the framework of China’s Twenty-First Century Maritime Silk Road. The ambitious Belt and Road Initiative Memorandum of Understanding—signed between Rome and Beijing in March 2019—included 50 agreements covering economic, cultural, and infrastructural areas. However, the anticipated economic boost for Italy has yet to materialize, while the fallout from getting significantly closer to Beijing amid criticism from the EU and the United States sparked an intensive political debate in the country. The Italian left has been pro-Chinese leaning, and the adherence to the BRI was first promoted by prominent members of the Democratic Party, since 2017. 47 It was the Five Star Movement, after their election victory in 2018 that formalized the partnership. The party signed a list of comprehensive agreements, and hosted China’s President Xi Jinping in Rome in March 2019, while the League Party was trying to hold back. 48 Italy became the only G7 country to join the BRI, and the largest economy among the other fifteen EU countries. 49 In the Chinese media, Italy’s membership was celebrated as a symbolic achievement for China in Europe, suggesting China’s growing political and diplomatic role worldwide. 50

Italy hoped that membership in the BRI would open new opportunities in trade and investment. The narrative was mainly focused on the importance of the Chinese market for “Made in Italy” exports. This story resonated with the public, 57 percent of which considered China as the world’s top economy. 51 Indeed, bi-lateral trade relations between Italy and China have increased in the last two decades, but very slowly (Figure 3).

Since the early 2000s, trade between the two countries has increased more than nine-fold—from almost $ 9 billion in 2000 to $ 85 billion in 2022. 52 This trade had decidedly favored China with China exporting to Italy more than three times the amount of imports. Italy’s roughly $19 billion in exports to China pales when compared to the more than $66 billion in Chinese imports, making China the third largest import partner. While Italy is becoming flooded with Chinese products, Italian exports to China makes up less than 3percent of its total exports, in 2022. Clearly Italy’s optimism about the BRI did not go as planned.

In 2022, China was the second largest import partner for Italy (after Germany), providing 9 percent of its imports, but only the 10th export partner. Italian exports to China make up less than 3 percent, compared to EU partners such as Germany (13%) and the United States (11%), or France (10%). 53

China’s investment in Italy has increased taking advantage of the 2008–2009 economic crisis, and acquiring Italian companies in distress. At a cumulative amount of 16 billion euros by 2021 Italy became the second most important economy for Chinese investment in the EU, after Germany. 54 Chinese acquisitions targeted big companies and small and medium enterprises in search of technologies, innovation, and brands.

The American Enterprise Institute that measures investments and construction contracts, including loans, calculates that the amount of Chinese investment has reached more than $27 billion in 2023. 55 The investments focus primarily on energy ($ 6.5 billion), transport ($ 8.75 billion), technology ($5.3 billion), and finance ($ 2.8 billion). (See Table 4). Among the main investments has been the acquisition of 17 percent of Pirelli, the world’s largest tire-maker, for $ 7.9 billion by the Chinese state-owned enterprise ChemChina. Through the People’s Bank of China, Chinese investors are also interested in the Italian stock exchange market. 56 They purchased shares worth more than $ 4 billion in Intesa Sanpaolo, Unicredit, Eni, Enel, Telecom Italia, Generali, Terna, and others. 57 Beijing is also very interested in the Italian financial and insurance sector. During Xi Jinping’s visit to Italy in March 2019, UniCredit-SACE Group and Exim-Import Bank of China signed several memorandums of understanding. These MoUs cover the concession to Cassa Depositi e Prestiti (CDP), Italy’s State lender whose investment vehicle CDP Reti, 35percent owned by the Chinese State Grid Europe, allowed launching the “Panda” bond program together with the People’s Bank of China. 58

This program supports Italian companies operating in the corporate finance and infrastructure sectors to invest in China. However, Italy failed to attract many projects last year, although 29 deals were signed amounting to $ 2.8 billion—including deals between China Communication Construction Company (CCCC) and the ports of Trieste and Genoa.

While Huawei announced in July 2019 a $3.1 billion 59 investment plan over the next three years, the Italian government has since hardened its stance on China’s human rights records and on restricting Huawei Technology access to fifth generation (5G) data networks. On December 2019, the intelligence and security committee of the Italian parliament recommended that the government “very seriously” consider banning Huawei and other Chinese equipment suppliers for Italy’s 5G mobile networks. 60 But the response from Giuseppe Conte’s government was that the existing screening procedures, including the so-called “golden power rules” to protect strategic assets (covering the defense, national security, transportation, and high-tech sectors, including 5G technology), were more than sufficient.

However, as of April 8, 2020, the “golden power rules” have been extended to a wide range of sectors, including health, finance, insurance, land and infra- structure, raw materials, robotics, and media, among others. 61 Worried that foreign players would purchase Italy’s distressed companies at low prices, the Italian government decided to intervene to protect national companies. The challenge is that protecting Italian companies from foreign acquisitions could be limited and difficult to implement in a dire economic situation when most companies risk bankruptcy. An intermediate solution for the Italian government instead could be their recapitalization through a public investment fund. At this stage, the Italian government is taking steps to stem the most immediate effects of the crisis by providing subsidies to families. Still, there is no real plan to protect businesses from bankruptcy, with only 400 billion euros in state-guaranteed loans available to companies. Other EU resources are expected to be added to these interventions in the coming months. 62

Since he took office in February 2021, Mario Draghi’s government, in one of its first acts declared that “golden powers rules” (Italy’s FDI screening mechanism) will be reinforced not only on strategic investment in ports and train infrastructures, but also access on strategic technologies, aiming to protect national companies. This important instrument has been used to prevent three Chinese takeovers, and undo one takeover that had been concluded during the previous government. 63 These actions started with the blocking of the Chinese Shenzhen Investment Holdings from acquiring the Italian semiconductor enterprise Lpe (specializing in epitaxy reactors). 64 The prospective buyer had ties with the Chinese arms industry. The Italian government has blocked a Chinese robot maker’s 2 million euros investment in a domestic robotics company under the country’s “golden power law” for sensitive industries. 65

Since its introduction in 2012, Italy’s Golden Power has been subject to numerous updates and is not limited only to the Brothers of Italy. This became the main focus in 2017, allowing the government to exert oversight over economic operations related to national security, but also expanding its scope to 5G, cybersecurity, banking, insurance, water, healthcare, agriculture and food, as well as strategic small enterprises (SMEs).

SMEs are the lifeline of the Italian economy, and are particularly exposed and at risk as a result of budgetary constraints. During the 2008–2009 crisis, China’s investment, mainly through acquisitions of Italian companies, went from 100 million euros in 2010 to 7.6 billion euros in 2015. Therefore, the most critical issue is developing a strategic plan that goes beyond the emergency and stimulates the restarting of the economy. This reboot will require a direct stimulus of public spending and the start of significant investments in the public sector. Such a program is needed to foster effects on aggregate demand. Yet, according to some studies, it will require financial assistance that is unsustainable given the current debt pile of over 2.5 trillion euros.

Infrastructure Projects

Since 2019, Italy has signed a long list of agreements with Beijing to create partnerships in infrastructure, industry, media, education, and the financial sector. 66 For months, Beijing has been trying to become an important player in the Italian infrastructure development for the Belt and Road Initiative “Maritime Silk Road,” eying the vulnerable hubs of Trieste and Genoa, whose development is envisaged in the Trans-European Connectivity Plan. Other projects in the MoUs signed in 2019 include railways and airports and space and telecommunications to complete the picture.

Since 2018, due to increased scrutiny following the adoption of EU screening mechanisms, there has been a decline of Chinese FDI in Italy. But recently, Faw, the largest Chinese car manufacturer, announced a more than 1-billion-euro investment for an electric car design center in Emilia Romagna. 67

The foremost effect of China’s disinformation campaign in Italy during the coronavirus outbreak was to dissipate the Italian political enthusiasm toward Beijing. Thus, in September 2020, the government froze a series of ongoing agreements with big Chinese state-owned companies, such as the participation of the China Communications Construction Company (CCCC) in the restructuring of the port of Trieste, replaced with a German stakeholder. Similarly, in space cooperation, Italy left the joint China-Italy space project by canceling the supply of a high-tech pressurized model of the Tiangong-3 (the Celestial Palace).

The focus of the government led by Mario Draghi was on the management of the pandemic and on the formulation of strategies that would redesign Italy’s role in the complex geopolitical chessboard. Strengthening European and Transatlantic alliances was very high on Draghi’s priority list. In 2021 Italy’s Presidency of the G20, was the perfect opportunity to exercise a leadership role in developing international reforms needed to drive global economic recovery through the post-pandemic era and reaffirming the historic anchors of Italy: the European and Transatlantic Alliance. Draghi addressed challenges with China, in his inauguration speech, raising awareness about human rights in China, observing “what is happening around China.”

Giorgia Meloni: a Strong Transatlantic Partner

The prime minister of Italy, Fratelli D’Italia’s Giorgia Meloni, who came in power in September 2022 has been clear that Italy would remain committed to the pillars of the EU and the West against autocratic governments such as Russia and China, in contrast to the more ambiguous positions of Forza Italia’s Silvio Berlusconi and Lega’s Matteo Salvini.

When it comes to Chinese transgressions, Meloni has been a vocal critic. Citing the importance for defending western values, Meloni has criticized the Chinese authoritarian system, the treatment of the ethnic minorities in Xinjiang, and the erosion of rights in Hong Kong. She had openly criticized the Chinese policies towards Tibet 68 and invited the Italian athletes to boycott the Beijing Olympics. 69

She was vocal about the role of China in mismanaging the COVID-19 pandemic, 70 disagreeing that China played a key role supporting Italy during the first months of the pandemic. Her position on the China’s military exercises against Taiwan, especially in response to Nancy Pelosi’s visit to Taipei, were framed as the “unacceptable behavior of Beijing” and that, “ the EU is an important market for China, that risks to be closed if Beijing decides to attack Taiwan.” 71

In stating her opinion about Italy’s membership in the BRI, she called it a big mistake and suggested that it would be very difficult to extend the agreement in 2024 if current conditions continue. Prime Minister Meloni has also declared that her government would ensure public ownership of the networks, on which companies will be able to offer services under free competition, starting with the communications sector. The digital transition, strongly supported by the EU Recovery Plan, “must go hand in hand with technological sovereignty, the national cloud and cyber-security,” affirmed Meloni. 72 She said this in the wake of what she commented during the electoral campaign in defense of strategic productions and national brands. 73 China’s Global Times, immediately after elections in Italy, took a stance over newly Prime Minister Meloni expressing concern and insisting that “with its favorable geographical location”, Italy is still a strategic hub of China’s BRI infrastructure plans. 74

The Memorandum of Understanding (MoU) between the Italian and Chinese governments will expire in 2024 75 and it is not clear if it will be renewed as Prime Minister Meloni says that this dossier “is still being evaluated”, while skepticism is increasing among members of her party. Minister of Defense Crosetto had presented Fratelli d’Italia’s firm position on not renewing the agreement, in November 2022. It sees that consultations with european and transatlantic partners will be a priority for Meloni’s government, and any decision will definitely have implications beyond Italy.

If BRI was seen as “inevitable” for Italy’s economic recovery, amid the escalation of the energy crisis, the Euro 209 billion Recovery and Resilience Plan for Italy 76 focused on the Green Deal, could be the turn-around moment for Italian economy: one that will be modern, digital, sustainable, and inclusive. If well implemented, it will be a lever to modernize the country, but it is also a litmus test for the stability of the common currency and the European project.

Valbona Zeneli is the Chair of the Strategic Initiatives Department at the George C. Marshall European Center for Security Studies.

Federica Santoro is a Political Analyst specializing in China’s foreign policy and society and former researcher at the Rome Center for Higher Defense Studies of the Italian Ministry of Defense.

The views presented are those of the author(s) and do not necessarily represent views and opinions of the Department of Defense or the George C. Marshall European Center for Security Studies.