Parsing "High" Chinese Investment In Italy Despite Italy’s Political Problem:Probing The Drivers Of Chinese Investment Through Case Analysis

In recent decades,Italy has been characterized by major internal problems and turbulent political situations.On the other hand,we have recently seen a proliferation of Chinese outward foreign direct investments(COFDI).While many of these FDI have targeted developing nations,many have also targeted developed nations,such as those in Europe.Italy,a country with low coefficients for political stability,rule of law,control of corruption and regulatory quality,according to data provided by the World Bank,is receiving more Chinese direct investments than many of its European counterparts,with more favourable coefficients.In this work,I investigate why this contradiction exists.The analysis is based on sources and in-depth interviews,with key informants belonging to different institutions,such as the Italy – China Foundation,the Chambers of Commerce,the Italian Trade Agency.Through this analysis,Chinese investments in Italy are increasingly targeting the acquisition of know-how,strategic location,famous brands,technological capabilities to tap competence in main sectors,such as the automotive one.This paper has a particular importance when it comes to understanding the current state of Italian policy with respect to COFDI.After the height of the surge of Chinese investment,and subsequent slowdown,the Italian government,along with several of its European counterparts,agreed to measures on stricter regulations,protection,oversight,and screening,when it comes to accepting COFDI.However,as of March 2019,the signing of the Memorandum of Understanding between Italy and China seems to suggest a turn away from such strict measures,and a movement towards continued leniency towards Chinese investment.This should create the understanding of Italian policy with respect towards Chinese Foreign Direct Investment,as one of desire.