On 1 July 2014 Italy took over the rotating presidency of the Council of the European Union (EU). Often referred to as “EU Presidency”, the Presidency of the Council of the EU designates the responsibility, rotating among the EU Member States every six months, to chair the meetings of the Council of the EU (the institution representing the Member States’ governments), determine its agendas, set a work programme and facilitate dialogue both at Council meetings and with other EU institutions. In the next six months, Italy will therefore be in charge of driving forward the Council’s work on EU legislation, ensuring the continuity of the EU agenda, orderly legislative processes and cooperation among Member States, and of representing the Council in relations with the European Commission (EC) and the European Parliament (EP).

Even if the responsibility of the rotating presidency has been re-dimensioned in recent years to reduce fragmentation and ensure greater continuity of the EU’s work, it nevertheless remains an opportunity for Member States to focus national governmental, administrative and public attention on the European agenda, and to advance national interests within the European framework. Larger Member States, in particular, often tend to use their presidencies to achieve greater influence over the EU’s agenda and to bring it closer to their own priorities.

The Italian Presidency takes places at a unique moment for Europe, as a new five-year legislature is starting and a new Commission gets appointed. The recent EP elections showed a rising discontent of voters in several Member States with the EU’s current course. Warning that Europe may be reaching a crossroad, Italian Prime Minister Matteo Renzi stressed that economic growth was essential to quelling anti-EU sentiment and winning back people tired of years of economic decline or stagnation. Promoting economic growth and improving employment prospects will therefore be the overarching priorities of the Italian Presidency.

In this Insight Series, LNE Group’s EU Public Affairs Practice looks at the Italian government’s plans and how they stand to impact technology stakeholders in Europe. We first look at the Italian Presidency’s programme and priorities, before reviewing in more details its research and innovation agenda, and analysing some of the key challenges and risks that may disrupt its plans in the coming months.

Programme and priorities: Europe’s quest for growth

The Italian Presidency’s work programme focuses on three sets of priorities: boosting growth and employment; bringing Europe closer to citizens; and promoting a stronger role for Europe in the world.

1. Boosting growth and employment

After the years of crisis where budget consolidation was at the centre of EU agenda, the Italian Presidency aims to spur a ‘fresh start’ for Europe by promoting a resolutely pro-growth agenda. Italy’s push for more growth-oriented policies will to entail efforts to:

  • revitalise the ‘Europe 2020‘ strategy initiated in 2010 to promote smart, sustainable and inclusive growth, but which has failed to live up to its promise so far;
  • deepen and strengthen the Economic and Monetary Union (EMU) through promoting structural reforms and developing EMU’s economic and social dimension;
  • foster industrial competitiveness, in particular through systematically including the ‘Industrial Renaissance’ agenda in all policies impacting on competitiveness;
  • strengthen Europe’s internal market, in particular in the fields of electronic communications and digital technologies and services;
  • improve the overall business environment for European companies, in particular for small and medium-sized enterprises (SMEs);
  • foster the performance of Europe’s public and private research systems, in particular through pursuing a more effective funding framework for innovation through the EU’s Research and Innovation (R&I) Programme Horizon 2020, as well as of through the European Structural and Investment Funds (ESIF);
  • develop more employment opportunities through measures aimed at tackling youth unemployment, improving the transnational mobility of workers and developing a new European educational agenda integrated with labour market needs;
  • promote sustainable growth and green jobs, in particular through brokering a deal on the 2030 framework for climate and energy policies. The framework proposed by the Commission earlier this year aims to make the EU’s economy and energy system more competitive, secure and sustainable. It seeks to drive continued progress towards a low-carbon economy and to build a competitive and secure energy system that ensures affordable energy for all consumers, increases the security of the EU’s energy supplies, reduces Europe’s dependence on energy imports and creates new opportunities for growth and jobs. The Council is committed to making a decision on the framework in October at the latest, and the Italian Presidency is likely to have to deal with much disagreement – and most likely horse-trading – between the Member States in the coming months. Italy will also promote investments in energy infrastructure, as well as increased diversification of supply and routes and a European external energy policy focused on energy security.

As part of its pro-growth agenda, Rome also aims to boost public investment through new financial instruments leveraging funds from the European Investment Bank (EIB). Rome wants the EIB to play a more active role in promoting growth and also hopes to win support for a large-scale investment programme on energy and telecoms infrastructure, to be financed through so-called ‘project bonds’. The Italian government estimates that there is a funding deficit of around EUR 700bn between current EU investment and the resources needed to tackle lethargic growth and rampant unemployment. To address this deficit, Italy intends to propose an ambitious investment plan as early as July.

More controversially, Rome intends to push for a more flexible interpretation of the EU’s Stability and Growth Pact, which sets strict deficit and debt rules for EU Member States. Proposals currently being floated centre on excluding investment and research spending from deficit calculations, or on giving struggling countries more time to bring their budgets back in line with the limits set by the Pact. This stance may put the Italian Presidency on a collision course with Germany, which remains opposed to any softening of the goals laid out in the Stability and Growth Pact and insists on the need for Member States to pursue structural reforms and fiscal consolidation at the same time.

2. Bringing Europe closer to its citizens

The second overarching priority of the Italian Presidency will be to bring Europe closer to citizens. It will do so by working to ensure the good functioning and loyal cooperation between institutions so that these can operate rapidly and effectively, and by promoting accountability and transparency. It will also promote a more active role for the EU in areas where the European dimension adds value, such as protection of fundamental rights as well as migration and asylum policies.

In particular, Rome will push for the establishment of a more integrated EU migration policy in light of the ongoing crisis in the Mediterranean. Due to its geographical location, Italy is significantly affected by migration from North Africa. More than 60,000 people have arrived in Italy by boat this year, and a series of tragedies have occurred. Consequently, Italy wants to create a genuine common European migration policy that would establish an equitable ‘burden sharing’ between those countries that are most directly exposed to migratory pressures and the other Member States. Rome also wants to strengthen the European Agency for the Management of Operational Cooperation at the External Borders of the Member States of the EU (Frontex), and to negotiate migration control agreements with third countries. The development of a Common European Migration Policy should, according to Italy, contribute to the EU’s growth agenda while also contributing to promoting growth in migrants’ countries of origin.

The Italian Presidency will also work towards the successful strengthening and enlargement of the border-free Schengen area and towards the reform of the EU’s data protection rules.

3. Promoting a stronger Europe in the world

The Italian Presidency aims to promote the EU’s role as a major actor on the international stage,. It will initiate actions aimed at addressing regional and global challenges, with a special focus on the EU’s immediate neighbourhood and in particular on the Mediterranean area. Italy will aim to support the transition process in North Africa and the Middle East through credible offers of assistance for partner countries in the region. Rome will also work at advancing the EU Neighbourhood Policy by focusing on the implementation of the recently signed Association Agreements with Georgia, Moldova and Ukraine. Italy will also work to support the normalisation process and internal stability In Ukraine. It will aim to further advance the EU accession process of the Western Balkan countries and to revitalise the negotiation process with Turkey.

The Italian Presidency will also pay particular attention to the external dimension of migration issues, in particular through the further development of dialogue with third countries of origin and transit of migratory flows, and to the external dimension of energy policy, in particular through pushing for EU energy agreements with third countries (including Israel, Algeria, Russia, Azerbaijan, Turkey and the western Balkan countries) to ensure the security of gas supplies to the EU.

Finally, the Presidency will support the pursuit and, wherever possible, finalisation of bilateral trade and investment negotiations with strategic partners, and the deepening of trade and investment relations with emerging economies. Most notably, it will encourage progress in negotiations for a Transatlantic Trade and Investment Partnership (TTIP) with the United States.

The next piece in this LNE Group Insight Series looks at the Italian Presidency’s programme and priorities in the field of Research and Innovation.