Italy Current Affairs - 2019
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Italy’s Prime Minister Giuseppe Conte signed a memorandum of understanding (MoU) with Chinese President Xi Jinping in Rome, endorsing the global infrastructure-building scheme of China. Despite the warnings and pressure from the US and the Europen Union, Italy has joined the china’s mega connectivity scheme and has become the first G7 country to do so. Italy is the thirteenth European Union country and also the first from Western Europe to join China’s Belt Road Initiative.
Why did Italy join the initiative?
Italy has stated that its participation in the initiative through a non-binding agreement was aimed to “rebalance an imbalance” in Sino-Italian trade. There are a lot of ‘Made in China’ coming into Italy and too little ‘Made in Italy’ that goes into China. Italy hopes for a substantial and gradual increase in exports to balance out the trade imbalances.
The decision of Italy is seen as an attempt to address its financial woes which has onerous public debt. Italy fell into recession at the end of last year. The agreement is seen as a trade off wherein Italy needs investment and China has those to provide. The agreement will aid Italy to underpin and strengthen its business ties with China.
The paper released by the EU’s diplomatic arm referred to Belt Road Initiative as a “systemic rival” and has threatened to tighten regulations on Chinese investment in Europe.
The World Gold Council its latest report highlights the quantum of gold holding by the different countries. The findings of the report are:
- India has the 11th largest gold reserve and the current holding pegged at 607 tonnes.
- India’s would have been at the tenth position had the list included only countries. International Monetary Fund (IMF) ranks third on the list with total gold reserves of 2,814 tonnes.
- The top spot is occupied by US gold reserves of 8,133.5 tonnes, followed by Germany with 3,369.7 tonnes.
- The third and fourth slot is occupied by Germany and France with reserves of around 2,400 tonnes each.
- China and Japan have more reserves of the precious metal when compared to India. Mainland China has gold reserves of 1,864.3 tonnes and Japan has gold reserves of 765.2 tonnes.
- The report notes that Gross purchases of 48 tonnes and gross sales of 13 tonnes led to an increase in global gold reserves by 35 tonnes on a net basis in January, with sizeable increases from nine central banks.
- This was the largest January increase in gold reserves since 2002 and illustrates the recent strength in gold accumulation.
The World Gold Council is the market development organisation for the gold industry and it aims to stimulate and sustain demand for gold, provide industry leadership, and be the global authority on the gold market. The members of the World Gold Council include gold mining companies.