I don't know what measures Under Secretary Guidi Guidi-Baffarini was referring to. I would guess the word "racist" is the reporter's synonym for "anti-Semitic" and not an official term. Herman Wouk's books suggest Italy was not terribly dangerous for Jews prior to September 1939 but the signs were there.
From the end of this article:
". . . the people believe in Mussolini, who has given them order, well-being, dignity and prestige and who is always right."
Who would have thought it would take another seventy years before the U.S. would elect a leader of this calibre.
Leni