Romano Prodi, twice former prime minister of Italy and president of the European Commission (EC) from 1999 to 2004, has had a comparatively long and deep engagement with China over the course of his career. As president of the EC, he led the EU in its negotiations with China over the role the euro would play in China’s foreign exchange reserve strategy, an engagement that paid off for Europe when the Greek sovereign debt crisis struck. However, during his second stint as prime minister from 2006 to 2008, factors including anti-Chinese sentiment in Italy helped sweep the Italian Right, led by Prodi’s political nemesis Silvo Berlusconi, back into power. Today, Prodi is a guest professor at the China Europe International Business School, where he spoke with China Economic Review about China’s strategy in North Africa, the invasion of Italy by Wenzhou entrepreneurs, and whether he plans to re-enter politics.
Q: Right now we have a little situation in North Africa. This is a critical area for the energy security of Europe and China both. Can you discuss the Chinese position in North Africa and what this means for Europe?
A: Well, you know, the problem is that the Chinese position in North Africa can only be guessed. At the time [the crisis began], there was no official position. There were thousands and thousands of Chinese workers in Libya and all other countries in the area. But there was no clear position, simply adherence to the idea of “non-interference.” If you want to know my forecast, what is certain is that the European influence in the area will diminish and probably the American and Chinese influence will increase. Of course, right now, nobody really knows what will happen to people; we are just thinking about oil. But the real problem is, will there be a flow of immigrants to Europe? Will this flow put European cohesion in crisis?
Q: A significant number of Europeans say that flows of immigrants have already created a crisis of cohesion.
A: Yes, but I don’t know if the flow of immigrants will happen. I hope not!
Q: Let’s stay with immigration. There has been a lot of coverage in the international press about a town in Italy called Prato, a textile town which has absorbed massive Chinese immigration from Wenzhou; these immigrants have taken over the textile and fashion industry there and now there’s a lot of tension.
A: I go to Wenzhou this Saturday. I want to understand the origin of immigration. To understand Prato from Wenzhou.
Q: What does this influx of Chinese immigrants into the textile industry, which was already very troubled by competition with low-cost Chinese labor, mean for Italian society?
A: I think that there is a general problem with liberal competition and displacement of low-level companies that has been going on for quite a few years. That is worrying and makes for difficult consequences. But from this point of view, the peak has already arrived. This is still a worrying problem, but it is a trend that we know well. The difference in Prato is that you have not only an economic problem, but a social clash, and this can be solved only with a dialogue and with new styles of cooperation that are difficult for political reasons. Some Italian politicians are very capable of exploiting the existing situation to gain votes, and use “anti-Chinese” sentiment as a route to power. In Prato [this sentiment] was so strong that it has changed the local government, which had always been left-leaning, but now it is right-leaning, and the only issue in the election was the problem of Chinese immigration.
Q: How does China change the dynamic by coming in and purchasing bonds and making statements publicly that have direct effects on confidence in the euro?
A: I started the dialogue between China and the EU when I was president of the European Commission. The Chinese have always been very positive vis-à-vis the EU. They always found it convenient for China to have a new protagonist in the world – one as strong as the EU and different from the US. I remember my dialogues with President Hu Jintao when the euro was shaping and the Chinese position was very clear: “We like the euro because we like to live in a world in which there is not only one power and one currency, but rather, a pluralistic number of protagonists. The euro and Europe are good for us.” I know the Chinese have been a little disappointed by the subsequent weakness of European policy. Europe in theory is a new protagonist in the world, but really, the internal divisions are so deep that we have, in too many cases, no common European policy. We are still number one in GNP, in industrial production and number one in exports, but we don’t exist. Trade is the only case where the power resides in the European institution and not in the single countries at present.
Q: There is a theory that China has an advantage in terms of its foreign policy, of not having to respond to voters. Now you yourself have had some difficulty with governing coalitions, in terms of implementing foreign policy –
A: [laughing] I am a symbol of these problems. But you know if we don’t make progress we shall progressively lose any possibility of influencing the world. For example, I worked for peacekeeping in Africa, and I am interested in African countries. Clearly you have a French policy targeted at the Francophone countries, a British policy targeted toward their old friends, and an American policy targeted only to the west coast and a few other countries. The only global policy is that of the Chinese – the only one! You know, you have a biased situation, in which China has a global policy and all the European countries have different policies. During the G8 in Germany a few years ago, the president of Senegal [Abdoulaye Wade] told me that more conclusions were reached with China during that time than had happened in four years [with Western countries]. This is a strategic advantage and I cannot deny it. This is why I am so adamant and so insistent on the necessity of European cooperation and European unity.
Q: Are you optimistic about how the current EU administration is dealing with China?
A: No, I’m not optimistic for the short term. I think it will be difficult to get any agreements in the G20. When you have such a movement in real terms, it is difficult to find a common view. In my view, we still have the problem of long-term discussions. Why am I saying that? Take G8 and G20. Everybody was in agreement that the G8 was over as an institution, that we had to represent all the world. So in the last meeting no strong decision was taken and even the decisions taken were not implemented. The new body, the G20, was working well in the first meeting, but because of the global financial crisis everybody was afraid, and its power has decreased. If you have no permanent structure that continues to digest the problems, it will be difficult to take a serious long-lasting decision in meetings that happen once per year.
Q: There was an article in The Economist that insinuated that while you were the president of the EC you spent your last year scheming a return into Italian politics. Do you have any plans to return to politics now, or are you happily retired?
A: I have no intention of doing that. When I was in Brussels, people were telling me always that I was thinking to get back into [Italian] politics, and it was absolutely not the case. You know, I spent the majority of my life outside of Italy. It is not by chance, I tell you, it is not by chance. I teach in China, I teach in the US I don’t take any political action, because my political life ended with a non-confidence vote of the parliament. Of course, any time that I open my mouth or I write something, they say, “Look, Prodi is coming back.” But, you know, I cannot commit suicide. I am a professor, I am a commentator, I regular
ly write articles, this is my amusement, and teaching is my job. Of course, if you ask me, am I happy with what is happening in my country? I tell you that I am desperate. This is, if you want, my comment. I think that we never had such a horrible opinion coming from almost the unanimity of all the international observers, and it is difficult for me to think that they are all wrong.