22/02/2010

Venice Faces an Olympic Challenge To Keep Afloat

Paul Betts, Financial Times

Renato Brunetta has an opportunity to claim the moral high ground and keep Venice's head above water.

This is normally the time of year when the tides regularly flood the city of Venice. This weekend was no exception, with the waters of the lagoon choppy and tourists huddled under umbrellas visiting the sites.

But the gloomy mood seems to be more pervasive these days and threatens to go beyond the normal seasonal tides. For Venice has been beset by a series of woes, and not just the issue of how to prevent it from sinking into obscurity.

Venice is facing a long-term economic decline. It once boasted one of Italy's largest industrial complexes employing 40,000 people directly, not to mention the tens of thousands of additional jobs with suppliers serving the petrochemical facilities and other heavy plants belching smoke barely three miles from the city's historic centre.

That has long been a contentious issue. How could such a polluting industrial complex live hand-in-hand with a fragile and unique wonder of architecture and art? But these days it is less of a problem. For one company after another is closing down - the latest is Alcoa, which is threatening to shut its aluminium smelter. Today, barely 8,000 people work in this industrial zone.

This issue is dominating the election campaign for the city's mayor next month. Reviving industrial activity and jobs as well as halting the economic, social and architectural decline of Venice will be the big challenges facing any new mayor.

Renato Brunetta, the Italian public administration minister and a Venetian, wants the job badly - so badly in fact that he has promised to raise ?25bn ($34bn) over the next 10 years to revive Venice. One of his ideas is to encourage new technology industries to replace the old smokestacks in the industrial zone. He also wants to see Venetians returning to the city's historic centre, which has proved so costly and inconvenient that many have chosen to flee.

But transforming Venice's industrial economy into an Italian Silicon Valley will not be easy. Everybody in Europe is chasing the same dream, not to mention the trend of foreign companies closing down and shipping out of Italy as they refocus and restructure to cope with the ongoing industrial slowdown.

GlaxoSmithKline has just announced plans to shut an important drug research facility in Verona, only an hour or so away from Venice. That kind of research facility is exactly what Mr Brunetta presumably would like to see coming to Venice.

Then there is the question of whether Mr Brunetta is taking on too much. Apparently he has no intention of giving up his ministerial post in Rome should he beat his centre-left opponent, Giorgio Orsoni, a Venetian lawyer.

Apart from the time he could devote to do the two jobs efficiently, voters worry about potential conflicts of interest. For Mr Brunetta may find himself caught in the competition between Venice and Rome to become Italy's candidate city for the 2020 Olympic Games.

This is turning into a cut-throat contest and Rome has already made it clear that Venice should back down and give the capital a clear run with the Italian Olympic Committee.

Mr Brunetta faces an obvious dilemma. Will he support Rome or Venice? And does his ?25bn investment plan hinge on winning the Games for the lagoon city? He would certainly do his chances in the mayoral race no harm if he trumpeted the Venice bid as part of his campaign.

Finally, Mr Brunetta, who is leading the local polls, also has an opportunity to seize the moral high ground and the credit that goes with it at a national and international level.

He should make clear that were he to become mayor, he would forgo his ministerial salary even if he kept both jobs. This would silence his domestic critics and bolster his credibility with the international community he is keen to attract to Venice - be they top business executives or decision-making sports administrators.