The Italian prime minister leaves Italy in a much better shape than he found it. It is only thanks to Mr. Draghi that The Economist crowned Italy the country of the year for 2021. Indeed, as the British newspaper last December, “it is hard to deny that the Italy of today is a better place than it was in December 2020”. 

Response to COVID-19

Italy’s COVID-19 vaccination rate is among the in Europe. Besides, il Bel Paese is set to receive nearly $192 billion () from the European Commission’s Next Generation EU, a €750 billion recovery fund designed to boost the bloc’s economic growth hampered by the pandemic. Italy is getting more funds than any other EU country.

The Italian prime minister planned to make efficient use of the EU money. In fact, his reform-rich Recovery and Resilience Plan (NRRP) had persuaded European Commission President Ursula von der Leyen to disbursemore than $25 billion () in pre-financing and the first tranche of over $21 billion () of the total sum. Italy also requested the second tranche, of over $21 billion () too, at the end of last month. These allocations, though, are conditional on Italy meeting the objectives set in the NRRP. So far, the Italian  government has . With Super Mario gone, however, it is extremely unlikely that Italy will continue to do so.

According to , the Italian GDP grew by 6.6% during Draghi’s first year in office, the highest rate since 1976. Bear in mind that the eurozone’s third largest economy was the first European country to be hit by the pandemic. However, the Russian invasion of Ukraine has sent energy, food and commodity prices soaring. And as a consequence, the Italian GDP contracted by in the January-March quarter of 2022. 

Italy, the Sick Man of Europe

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The Draghi administration instituted damage control measures to reduce the impact of the war on the economy early on. It is for this reason that Minister of the Economy and Finance Daniele Franco estimated “” for the GDP in the second quarter in a speech at the Italian Banking Association (ABI). Neither did Franco know nor could he possibly predict that Giuseppe Conte’s party would unleash hell in Palazzo Madama. Conte was Draghi’s predecessor and has been the president of the populist Five Star Movement since August 2021.

To understand why Draghi came under pressure, we need some country-specific context. A gifted economist, Draghi took charge of a coalition government to nurse the Italian economy back to life. At the time, Italy was on the brink of collapse due to COVID-19. After Russia invaded Ukraine, economic recovery slowed down and Draghi’s coalition partners saw this as a good time to sabotage him. The center-right Forza Italia of former premier Silvio Berlusconi, the right-wing League of Matteo Salvini and the Five Star Movement led by Conte decided it was time to pull the rug under Draghi.

As support collapsed, Draghi resigned. Italian President Sergio Mattarella promptly rejected Draghi’s resignation. This did little to stop markets from panicking. At a time when eurozone inflation is reaching a record , the spreads between Italian 10-year government bonds (BTPs) and German Bunds have risen to new. On July 20, Draghi the Italian Senate and declared that he was willing to stay on as prime minister if the coalition parties backed his reform agenda. Unfortunately, the above-mentioned parties did not even have the decency to show up in parliament for the vote of confidence. This forced Draghi to resign despite winning the confidence vote.

Draghi’s final resignation prompted markets to react even worse than before. The Italy-Germany bond spreads shot up to points. They only started to go down again when the ECB it would raise interest rates and launched the Transmission Protection Instrument (TPI), a new tool to tackle financial fragmentation in the euro area.

Renewed Credibility and Influence Abroad

With his considerable experience, statesmanlike stature and personal connections, Draghi has restored Italy’s credibility on the European and international stage in his short tenure as prime minister. Thanks to him, Italy successfully led the G20 and COP26 throughout 2021. Italy also (pro)actively participated in G7, NATO, and EU Summits, as well as other high-profile events such as the International Conference on Libya and the Summit for Democracy. Draghi’s deft diplomacy demonstrates how committed he is to strengthening multilateralism and democratic values. As a result, Italy has gained in strength, influence and credibility abroad under his sapient premiership.

How the European Union Lost Italy to the Radical Right

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As the political crisis unfolded, Super Mario was still hard at work. On July 19, he spoke with Ukraine President Volodymyr Zelenskyy who Draghi for his “significant personal contribution to granting Ukraine the status of a candidate country for EU membership”. The day before, Draghi was in Algeria where he signed several, including an energy deal enabling Italy to reduce gas imports from Russia. The Italian government has signed similar deals with Angola, the Republic of Congo, Mozambique, Egypt, Bahrain, Qatar, Turkey and Azerbaijan.

In fact, in May the Trans Adriatic Pipeline (TAP) brought of gas from Baku, Azerbaijan all the way to Melendugno, Southern Italy in the span of a weekend. Similar negotiations with Israel and Libya are ongoing. By seeking to diversify gas supplies and investing in renewable energy projects, Draghi has been trying to reverse decades of dependence on Russian energy. Following Draghi’s resignation, however, Russia has its gas supplies to Italy by 71,4% in just one day.

As recently pointed out, Draghi “is (or at least was) shifting the power dynamics within the EU”. Proximity to the Mediterranean Sea and the Middle East and North Africa (MENA) region is no longer perceived as a liability. The risk of increased migration is now trumped by the opportunity of importing non-Russian gas and oil into Europe. 

Even as Draghi nudged the EU in a new direction, he deepened ties with France, the outgoing president of the Council of the EU. On November 26, 2021, the two EU founding members signed the, a historic deal to strengthen cooperation between Italy and France.

The agreement is very similar to the between France and Germany which celebrates its 60th anniversary next year. The EU’s biggest economy assumed the presidency of the G7 in January. Yet the post-Angela Merkel traffic-light coalition has struggled to speak with one voice and retain its leadership role in Europe. For all its promises to increase defense spending and deliver lethal weapons to Ukraine, Germany is still very reliant on Russian energy. Hence, it has proved reluctant to suspend the Nord Stream 2 Pipeline and support a full embargo on Russian oil and gas. 

Until a few weeks ago, Italy was the second largest importer of Russian gas, next only to Germany. Yet the Draghi administration has been bold enough to back all sanctions on Russia proposed by the EU and its North American allies.

Stronger Transatlantic Ties

On the other side of the Atlantic, US President Joe Biden and his administration have been looking at Draghi’s Italy with renewed interest and respect. The recipient of The Atlantic Council’s 2022 Distinguished Leadership Award has proved to be a strong leader and a committed transatlantic partner. 

Is Russia’s War in Ukraine Creating a New European Security Architecture?

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Draghi has been pushing for the development of a strong European defense to complement NATO and took a tougher stance vis-à-vis both Russia and China than his predecessors long before Russia’s aggression against Ukraine began. In his May to the European Parliament, the Italian prime minister urged greater European coordination on defense. The economist also made the case for more efficient defense spending among EU member states, something that would greatly benefit NATO as well since 21 (soon 23) EU countries are also NATO allies.

Unfortunately, Draghi did not have it all his own way though. Despite his to increase Italy’s defense budget, the Boot will not hit NATO 2% GDP defense spending target until 2028. Nevertheless, in the eyes of US Defense Secretary Lyloyd Austin, Italy remains “one of Europe’s most security providers”. 

Last year, Italy celebrated 160 years of diplomatic ties with Washington and also marked 70 years of NATO’s presence on its soil. The country is currently leading the NATO mission in Iraq and is supposed to take the lead of the mission in Kosovo in the fall. Italy’s Eurofighter jets have been in Romania since November 2021 and the country has been supporting NATO all the way from the Baltic to the Mediterranean. In addition, since Russia’s invasion began, Draghi has been to provide heavy weapons to Ukraine despite the strong opposition from within his coalition. He has even looked to defense cooperation with Japan amid concerns that China might be preparing to attack Taiwan.

Thanks to this renewed international credibility, Italy has reclaimed its rightful place within the , an informal framework used by the United States, France, Germany, the UK and now Italy again to discuss and coordinate their foreign policy on matters of common interest.

Political Mayhem Returns

Draghi’s premiership has undoubtedly transformed Italy into a power player in Europe and positioned it to be a stronger and more credible ally for NATO and the US. However, as  basketball legend Kobe Bryant once said “Job is . Draghi needed more time in office to undertake all the reforms envisaged in the NRRP to modernize Italy. Instead, Italy’s best player was fouled by his own teammates and sent to the locker room in the middle of the game. His season is over. 

Despite not being an elected official, Draghi enjoyed the support of both politicians and ordinary citizens. Since he first tendered his resignation, there have been in Italy’s main cities and petitions signed by nearly mayors and governors and Italians demanding that Draghi stay on in the nation’s top job until the next elections, originally scheduled for March 2023. Now that Draghi has resigned, Italy will go to the polls in September. 

Sadly, Draghi’s ambitions for Italy clashed with the country’s grim political reality. The notoriously Russian-friendly Five Star Movement, League and Forza Italia are jeopardizing Draghi’s hard-fought legacy of credibility for the country. By behaving so irresponsibly, they are throwing Italy into political and economic instability once again. If Super Mario could not change Italy, then no one else can. The premature ending of Draghi’s government is bad news not only for hardworking Italians, but also for the EU, NATO and Ukraine, who might soon lose a key partner in its fight for freedom. In the Kremlin, on the other hand, this is a cause for celebration because whoever is elected this fall will never be as pro-Europe and pro-US as Mario Draghi.

Mr. Prime Minister, you will be missed!

The views expressed in this article are the author’s own and do not necessarily reflect 51łÔąĎ’s editorial policy.

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In the past, Europeans often appeared reluctant to coordinate their national foreign, security and defense policies. Instead, they preferred to “go it alone”. The Ukraine crisis, however, has elicited a strong, unified response from the European Union (EU), the North Atlantic Treaty Organization (NATO), and their member states as never before. To put pressure on the Kremlin and bring the war to an end as soon as possible, the EU, in close coordination with its North American allies, has adopted unprecedented measures. In June, EU member states agreed upon a sixth package of sanctions, which included an embargo on Russian oil imports (currently 90%) and the removal of three Russian banks from the international SWIFT payment platform. They also granted Ukraine and Moldova EU candidate status. This would have been unthinkable only a few months ago.

In addition, the EU activated for the first time the European Peace Facility (EPF), a newly established off-budget fund that replaced, merged and expanded the scope of the Athena Mechanism and the African Peace Facility, and introduced the possibility for the EU to deliver lethal weapons to third countries. Through the EPF, the bloc has already provided $1.5 billion (€1.5 billion) in financial support to Ukraine’s military, with anadditional $500 million () announced on May 24. The next day, the European Commission (EC) adopted the second annual work program of the European Defence Fund (EDF), through which it has been scaling up funding for collaborative research in innovative defense products and technologies. The EC also introduced some new measures to promote defense innovation under a new umbrella: the EU Defence Innovation Scheme (EUDIS). In , EU leaders had agreed on the need for more effective defense spending. This $2 billion (€2 billion) investment will spur defense innovation while reducing industrial fragmentation wherever possible in coordination with NATO’s Defence Innovation Accelerator for the North Atlantic (DIANA) and the freshly launched . 

Meanwhile, NATO has been progressively bolstering defense along its eastern flank in response to Russia’s invasion of Ukraine. In February, the Alliance activated the NATO Response Force (NRF), a high-readiness multinational force of 40,000 troops that can be deployed quickly in response to an emerging crisis. The NRF was activated for the first time for the purpose of deterrence and defense instead of crisis management. More recently at the NATO Summit in Madrid, US President Joe Biden that the United States would establish a permanent US Army headquarters in Poland and further expand US military presence in Europe, which currently stands at around 100,000 troops.

Furthermore, the raging war has reignited defense spending debates at the member state level, not only in the “Big Three”—Germany, France, and Italy—but also among non-NATO EU member states with a long tradition of neutrality such as Finland, Sweden and even Ireland.   

The public debates in Germany, France and Italy

Germany has lifted restrictions on sending German weapons to conflict zones by third parties and promised to arm Ukraine. This is a major foreign policy shift. Chancellor Olaf Scholz also pledged to create a special $100 billion (€100 billion) fund for military procurement and committed to spending 2% of the GDP on defense by 2024, in line with the goal for NATO members. However, Scholz has been heavily criticized both at home and abroad for his Ukraine policy. According to polls, while 69% of Germans support boosting defense spending, public opinion is , with 45% in favor and 55% against, over the supply of heavy weapons to Ukraine. The day after the Bundestag voted to provide heavy artillery to Kyiv on April 28, an signed by 28 German intellectuals advising Scholz against this policy gained support online. A week later, signed by twice as many German intellectuals called on Scholz to provide heavy weapons to Ukraine. 

Some, including Ukrainian President Volodymyr Zelenskyy who recently the Ukrainian ambassador to Germany, have criticized Scholz for repeated delays and overall reluctance to send arms to Ukraine. Zelenskyy has even called into question Germany’s leadership role in Europe. A deal on the special fund was eventually reached by the German “traffic-light” coalition government and conservative opposition parties in late May and approved by the Bundestag in early June. In terms of arms supplies, however, Germany has directly only Panzerhaubitze 2000 self-propelled howitzers to Ukraine. The rest of the military aid by the German government, which is supposed to include Gepard anti-aircraft vehicles, IRIS-T SLM anti-aircraft and MARS II multiple-launch rocket , is only likely to reach Ukrainian soldiers by late summer or even early autumn.  

In Italy, the political willingness of the executive branch to arm Ukraine has inflamed discussions on defense investments and increases to the defense budget. On June 21, Italy’s Foreign Minister Luigi Di Maio with the Five-Star Movement and formed a new parliamentary group. The casus belli was precisely the party’s opposition to Italy supplying arms to Ukraine and insufficient support for NATO and EU decisions.

Earlier this spring, a heated took place in Rome. The populist party currently led by former prime minister Giuseppe Conte clashed with the other parties supporting the technocratic government led by the former president of the European Central Bank, Mario Draghi. The prime minister seemed particularly appalled by Conte’s arguments against increasing the defense budget when the country is still grappling with the health crisis and socio-economic consequences of the COVID-19 pandemic. The two have been on a collision course ever since.

As a result, Italian defense expenditure will not hit the NATO 2% GDP target until 2028, lagging behind other allies. However, unlike Germany, Italy has not shied away from sending heavy weapons, such asStinger surface-to-air missiles and M2 Browning heavy , to Ukraine. Despite the topic of arms supplies being classified information, Corriere della Sera reported that the third decree (note that a is in the making) of the Italian government in May aimed to provide Ukraine with even heavier weaponry, includinghowitzers 155/39 FH-70 . At the end of June, three Panzerhaubitze 2000 self-propelled howitzers, officially on their way to Germany for a joint military exercise, were in Southern Italy for lacking the necessary authorizations. Given the secrecy that surrounds the country’s arms deliveries to Kyiv, it cannot be excluded that Ukraine was their final destination. 

In contrast to Germany and Italy, increasing defense spending in France has not caused much debate. This could perhaps be because of the reelection of President Emmanuel Macron. However, it is important to note that France has been increasing military spending for quite some time now. Last year, the country around $57 billion (€57 billion) on defense (around of its GDP) and, in March, even before securing his second term, Macron that the defense budget would be increased further in response to the ongoing war. French defense spending is due to reach the NATO 2% goal no later than 2025, only one year behind schedule.

Minister of the Armed Forces Sébastien Lecornu recently a $3 billion (€3 billion) defense budget increase compared to 2022, bringing the total for 2023 to $44 billion (€44 billion). When it comes to arms deliveries though the Elysée Palace has so far only sentMilan anti-tank missiles, Mistral anti-aircraft and Caesar self-propelled to Ukraine. Since his joint visit to Kyiv with Scholz and Draghi, Macron has been pledging additional Caesar howitzers and has even asked the French arm manufacturer Nexter to increase its production. The French president might be doing so to diffuse tensions over his statement about not “” Russia over Ukraine.

Macron’s centrist alliance suffered a severe blow in June’s parliamentary elections. However, this should not affect French foreign and defense policy because these traditionally are the domain of the president. 

And in Finland, Sweden, and Ireland

Meanwhile in Northern Europe, Finnish Prime Minister Sanna Marin and Swedish Prime Minister Magdalena Andersson made history. Breaking with longstanding policies of not supplying arms to war zones, the two Nordic countries were the first to announce that they would provide weapons to Ukraine. Since the war started, Sweden has provided 10,000 anti-tank weapons (5,000 in February and another 5,000 in March) and other military equipment (helmets, body armors, rifles etc), of which more deliveries were at the end of June. Likewise, in early May Finland announced its of weapons to Ukraine, although details regarding the content of this as well as previous shipments have not been disclosed.

Furthermore, despite Russian President Vladimir Putin’s threats, the two female leaders formally reversed decades of neutral foreign and security policies by formally applying for NATO membership on May 18. The move has been backed by the majority of and, who have also supported the significant increase in defense spending. This will allow defense spending in both countries to reach and, in the case of Finland, even the NATO 2% GDP goal. 

Following the signing of a trilateral memorandum with Turkey, which had initially objected to Finland and Sweden joining NATO, both Nordic countries can now become full members of NATO once all Allied nations ratify their bid. At the NATO Summit in Madrid, all 30 members signed the accession protocols. However, the ratification process for the NATO membership of the two Scandinavian countries is still ongoing and might take up to a year to conclude. While Germany has ratified the membership of Finland and Sweden, Italy and France are yet to do so.

At present, Finland and Sweden can participate in NATO meetings and possibly benefit from greater intelligence sharing. However, they are not yet protected by the Article 5 guarantee. This might explain why Finland just recently passed a that allows it to build barriers on its border with Russia. There is in fact a very high risk that the Kremlin might engage in hybrid tactics in retaliation for Finland’s NATO membership bid.

Even Ireland, a neutral island with no proximity either geographical or commercial to Russia, isdoubling its relatively low . Currently, Dublin spends a mere 0.3% of its GDP on defense. Unlike Finland and Sweden, Ireland is not sending military supplies to Ukraine though and does not plan on NATO “any time soon.” Still, the ongoing conflict in Ukraine is changing the debate in the country and forcing Ireland to rethink its security and defense policy. In March, the three coalition government parties—Fine Gael, Fianna Fáil and the Green Party—all against a bill that called for a referendum about writing neutrality into the Irish constitution. 

Taoiseach Micheál Martin recently met with Zelenskyy in Kyiv and reiterated his support for Ukraine’s EU membership and sanctions on Russia. Much like Minister for Foreign Affairs and Minister for Defence Simon Coveney, Martin is of the view that the Irish concept of neutrality should “” and “.” Ireland might not be vulnerable to conventional military attacks, but it is extremely vulnerable to cyber threats and attacks.

Barry Andrews, the leader of the Fianna Fáil in the European Parliament, observed that “75% of transatlantic underwater internet cables flow through or near Ireland’s exclusive economic zone.” Dublin also hosts the European headquarters of big-tech giants of the likes of Google and Facebook. This is probably why Ireland joined the NATO Cooperative Cyber Defence Center of Excellence in 2019, despite not being a NATO member. Ireland is only a member of the Partnership for Peace. Since 2017, the country has also participated in EU Permanent Structured Cooperation (PESCO) projects as an Observer. This participation is expected to become more in the near future.

An Important Opportunity

In conclusion, it is our belief that the war in Ukraine represents an important opportunity for Europe to strengthen its common security and address defense capability shortfalls. A new security architecture is emerging from this crisis in which the EU and NATO should seek not only to complement, but also to mutually reinforce one another. They must also keep working together to protect the common values and principles both organizations stand for. The real challenge going forward for the EU is how not to lose momentum and maintain the same level of consultation and cooperation with NATO allies, especially with the US. This momentum could be lost quickly once the war is over and it is then that member states have to continue to invest in defense, when threats are no longer direct nor immediate to their lands.

The views expressed in this article are the author’s own and do not necessarily reflect 51łÔąĎ’s editorial policy.

The post Is Russia’s War in Ukraine Creating a New European Security Architecture? appeared first on 51łÔąĎ.