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'After Germany and France, Italy is the third largest economy in the Eurozone. Due to COVID, the EU suspended the SGP in May 2020 for an indefinite period. In March 2022, the Italian government called for the suspension to be continued because of the situation in Ukraine. Italy’s government debt to GDP ratio is currently over 155 per cent, well beyond the 60 per cent stipulated in the SGP. The country would default if the EU stopped funding its public debt. But under current circumstances, for how long would this support be forthcoming? Should Italy withdraw permanently from the SGP, the Euro would cease to be a viable currency. Some analysts believe that if Italy defaulted, the future of the EU itself would be at stake.
Enrico Colombatto, a professor of economics, has suggested that Italy would be better off seeking financial rescue from China, in exchange for some strategic assets, in particular access to the port of Trieste. A move towards stronger links with China would imply a shift in Italy’s foreign policy from a continental focus to a Mediterranean one.'
EU sanctions against Russia have increased the cost of gas and pulverised Euro exchange rates, both further depressing living standards in Italy and increasing manufacturing costs. Italy’s gas prices have thus increased by a factor of five since 2021, prices of food and other essential goods have increased between 10-25%, and its economy could be facing approximately a 5 per cent drop in GDP next year.
This is creating a situation where, according to Indian ex-diplomat and commentator M.K. Bhadrakumar: ‘The plain truth is that the European integration project is over and done with’.
Should Italy distance itself from NATO or leave it altogether, particularly in the light of Turkey’s ambivalent stance and the possibility of a Russian victory in Ukraine, it is doubtful that the alliance would be able to survive.
If Italy’s economy and its energy security deteriorate further due to the embargo on Russian energy supplies, or should NATO troops intervene directly in the conflict, it is increasingly likely that the Italian government will consider realigning its international orientation away from a continental strategy centred on the EU and NATO and towards a Mediterranean-focused one that is closer to BRICS. It could even become the third ‘I’ in the BRICS after India and Iran, as one analyst has advocated, creating a tipping point in the global economy.
Link to article:
http://thesaker.is/mussolini-re-dux-could-italys-new-foreign-policy-trigger-a-passage-to-a-multipolar-world-order/ - Anonymous
The Native Americans said - 'When you see two fish fighting in pool, look around and you will see a White men standing nearby'.
ReplyDeleteThe White men were the ones that coaxed the fish to fight and is ready to reap the benefits when the fighting is over. Win or lose, they will benefit. Isn't that the situation in Ukraine right now? The USA can continue to sell expensive oil to Europe and Ukraine can die to the last man standing. That is just collateral damage after all.
Already the USA is reaping all the benefits of energy sales to Europe and the stupid Europeans still have not had enough of the sodomising by the USA. Energy at four times they were getting from Russia, decimating their industries, causing sufferings among their citizens, trying to lure their manufacturers to the USA using the 'Inflation Reductions Act' and using incentives to entice European industries to relocate to the USA.
Just relentless printing, and doing all the damages to the rest of the world like sanctions, comes with all the privileges the USA enjoys having the US$ as the global reserve currency. Now the USA is making hay while the sun still shines, with budgets running into the trillions despite all the debts. However, those days are numbered, with Saudi Arabia's intended move to accept all currencies in the oil trade becoming official. That means all countries do not need to hold US$ or at least that much as today, when oil sales had to be in US$, like it or not.
BRICS is just an economic classification. There has been no substantive real cooperation other than the formation of the NDB, which charges higher fees than the ADB. Italy is a black hole which will swallow up money.
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