In the run-up to the April 9 European Union-China summit in Brussels, Chinese President Xi Jinping has had an eventful trip to Italy, France and Monaco. His biggest achievement was the signing of a memorandum of understanding in Rome, which made Italy the first member of the Group of Seven industrial countries to sign up to China's Belt-and-Road Initiative (BRI), an ambitious transcontinental project to build connectivity mainly through infrastructure projects spanning parts of Asia, Africa and Europe. Italy's endorsement of the BRI is being hailed in Beijing as a big boost for Mr Xi's signature project, from which other G-7 members have kept their distance. Mr Xi also signed 29 deals with Rome worth €2.5 billion (S$3.8 billion), and a state-owned Chinese construction firm entered into agreements to upgrade the Italian ports of Genoa and Trieste.
On paper at least, these arrangements hold the promise of mutual benefits for both Italy and China. Italy's economy, reeling under recession and saddled with high levels of public debt, could get a much-needed boost from future Chinese investment. The government in Rome hopes that improvements in connectivity will spur exports to China, with which it runs a US$12.1 billion (S$16.4 billion) trade deficit. China stands to gain from easier access to the EU market, more export opportunities for its overcapacity-ridden capital goods sector and, importantly, the possibility of greater legitimacy for the BRI itself within the EU, of which Italy is a founding member and the third largest economy.