China-Italy BRI Deal Could Be as Historic as Marco Polo

In 1271, Marco Polo traveled from his home in Venice to China via the Silk Road. The Travels of Marco Polo had huge influence. Italy is now signing agreements to join China’s Belt and Road Initiative.

China is investing in a new Venice port and in three other ports in Italy. This can boost trade between China and Europe and provide economic benefits.

Four ports in Italy may be in line for Chinese investment under China’s Belt and Road Initiative.

There is a good analysis by Liu Rui, senior fellow with the Chongyang Institute for Financial Studies at Renmin University of China.

In February 2017, China Communications Construction Company signed a contract with Italy for the design of Phase 1 of Venice Offshore Port with 4C3. This will be a 20-meter deep offshore port will be built in the sea area 15 kilometers from the Malamocco Port and the offshore terminal project will be able to handle large container ships holding 18,000 to 22,000 TEUs.

Chinese companies are fixing the port of Trieste. Trieste is opposite Venice. These ports could revive the role Italy played during the Austro-Hungarian Empire.

Italy will be the first of the G7 countries to participate in the China-proposed Belt and Road Initiative (BRI). Italy has debt problems, an aging population and a sluggish economy.

Sea trade between Europe and Asia is developing rapidly. 63 percent of the total trade between China and Europe is by sea.

Chinese firms have done business at an important Greek port. China has a 35-year franchise right to the No.2 and No.3 container terminals of the Piraeus port and own 67 percent stake in the port.

The Greek port has rapidly revived and has become one of the most active logistics centers. The port has contributed significantly to the local economy.

The re-emergence of the Greek port has posed a challenge to Italy. Italian ports are superior to Greek ports. The Greek ports are located at the edge of Europe, while Trieste and Venice are closer to the heart of Europe. If freighters could go up the Adriatic Sea to Venice and Trieste, it will be quicker for them to get to the heart of Europe by road and rail.

Italy has stronger industrial and logistics capabilities than Greece. The country’s ports have the potential to build warehouses and trade processing zones.

SOURCES – Global Times, South China Morning Times

Written By Brian Wang.