Italy became the only G7 member to join the Belt and Road Initiative (BRI) in 2019. Yet, 5 years later, Rome announced its withdrawal, a rare reversal among BRI participants. This article examines Italy’s abrupt policy shift. We argue that Italy’s decision to join and subsequently exit the BRI reflects a strategy of institutional hedging, in which states calibrate their institutional engagements based on evolving assessments of institutions’ relative capacities, relevance and risks. Initially, Italy perceived the BRI as an unparalleled opportunity in the absence of viable Western alternatives, with anticipated risks deemed limited. As rival institutions emerged, Italy’s relevance in them increased, and the risks of participation in the BRI grew, Rome recalibrated its stance at different stages from institutional hedging to balancing. By examining this case, we demonstrate how small and middle powers navigate institutional rivalry between great powers. Theoretically, this article contributes to the literature by developing an analytical framework of institutional hedging, an existing yet insufficiently elaborated concept, to account for small and middle powers’ behavior regarding international institutions.
Xu et al. (Mon,) studied this question.