About theauthor:Isabelle Schatzschneider is an environmental activist and commentator on EU environment policy. She is a Research Associate at the Friedrich-Alexander University, Erlangen-Nüremberg, and former researcher at the Schweisfurth Foundation in Munich.
GiorgiaMeloni’s love-in with Donald Trump confidant Elon Musk looks like it might be paying off, with reports suggesting that her government is poised to sign a $1.56 billion telecommunications deal with Musk’s SpaceX.
Meloni’s government has yet to confirm the deal, but Musk has not been so coy. On X, he said: “Ready to provide Italy with the most secure and advanced connectivity!” Meanwhile, Melonidescribed Musk “a great figure of our times.”
Meloni has coveted a close relationship with Trump, too, although she has denied that the SpaceX deal has anything to do with her surprise Januaryvisitto Mar-a-Lago. Linking the two was “simply ridiculous.”
Trump has warned that Europe will face new tariffsonce he re-enters the Oval Office, but whatever happens between Washington and Brussels, the SpaceX deal will likely go down well in Italy.
Meloni has hung her hat on economic revitalization in Italy and despite slight improvements on a dismal growth rate of 0.1% in 2023, the country needs to be more ambitious in the years ahead.
If not for Italy, then for her own political future. Meloni was initially branded a neo-fascist rabble rouser when she was elected in 2018 buthas emerged as a political pragmatist who has worked closely with the European Union on issues like migration. Meloni also helped push through a military aid package to Ukraine, for which she has expressed steadfast support, unlike some of her far-right compatriots in Europe.
At home, Meloni has an approval rating of 41%, a figure that her fellow leaders would covet. But critics point out that the popularity of the Brothers of Italy, Meloni’s party, is a result of a weak opposition. Italian voters – like many in Europe – are fickle, and Meloni will face them again in 2027.
When it comes to the economy, little in Italy has changed. The country is still almost totally dependent on tourism and manufacturing, two inconsistent industries with growing competition. It faces not only low-growth rates, but ballooning debt, and remains one of Europe’s most sluggish economies.
Meloni’s administration has advanced initiatives such as the Mattei Plan, which aims to strengthen Italy’s links with African nations via infrastructure and energy projects. It is not a bad idea: in terms of both workforce and energy resources, the African continent could help Italy deal with both rising energy prices and an ageing workforce.
What it will also need is foreign investment, and for inspiration it may like to look north, to Germany. Germany’s central location, skilled labour force, and industrial infrastructure have made it Europe’s economic engine, but hit by the embargo on Russian energy, the country’s industry faces a 3% drop in 2024, the third consecutive year of decline. To boost its struggling industrial sector, Germany has recently attracted a $15billionbuyout bid from the Emirati energy giantADNOC for Covestro, a leader in sustainable chemistry.
ADNOC’s acquisition, under which it plans to invest over$150 billion until 2027, has been integral in proving that the Abu Dhabi-based company is serious about its environmental goals, but it also stands to benefit Germany’s manufacturing workforce. The deal, the UAE’s largest-ever cross-borderacquisition, will only strengthen ties between the two nations, and support Germany’s position as Europe’s industrial centre.
Italy could capitalize on this moment to set out a stall as a player in sustainable development, and to drive meaningful change. Italy’s investment appeal has declined in recent decades, but it is gaining traction in green hydrogen and renewable energy. In August 2024, Rome announced more than $1billion in subsidies towards hydrogen projects, while solar and wind energy projected a record amount of power in Italy during 2023.
If it can court investments comparable to ADNOC’s, it may well precipitate an economic revitalization, and one that is very much in keeping with global emissions targets and the proportion of power that comes from oil and gas. Italy could also look at initiatives such as tax-free industrial zones and cutting red tape for businesses wanting to come to Italy, as much as it can, given the regulatory constraints from the EU and national laws.
Will that revolution start with Musk? There are worse places to start than the second-most powerful man in the free world. And Meloni has not been putting all her eggs in one basket: in September she met with Larry Fink, the chairman of BlackRock, about potential investment in data centres and energy infrastructure in Italy by the American investor.
A month later, Meloni met with Brad Smith, the president of Microsoft, as the US tech giant announced a $4.8 billion investment in artificial intelligence and cloud infrastructure in Italy over the next two years. Microsoft said that the investment was the largest in Italy to date.
This is a good start, and if the SpaceX deal comes off, 2025 could be something of a coming-out party for Meloni and Italy. A statement that after decades of languishing in the shadows, Italy is finally open for business.
