The famous tricolore of Italy. First used for the Cispadane Republic (1796-8), also symbol for the Italian uprisings of 1848. It was adopted as national flag in 1861.
History
Italy has a long history that dates back to antiquity. Greeks and Carthaginians colonised Southern Italy from the 8th century BC and influenced the Romans who would build a majestic empire lasting for centuries until its demise in Italy in 476 AD, when Odoacer conquered Rome marking the fall of the Western Roman Empire. Italy would remain divided in many small entities until 1861, with a Napoleonic Kingdom of Italy existing briefly in Northern Italy from 1806 until 1814.
During the Middle Ages many powerful Italian states emerged that had a profound influence over the entire Mediterranean. The Renaissance started in Italy, influencing modern culture and science in Europe tremendously. Despite all the achievements the Italian states remained divided and lost their power to the larger Habsburg (Spain and Austria), French and Ottoman empires.
First Kingdom of Italy (1806-1814)
Napoleon, born Corsican so more Italian than French, conquered the north of Italy in 1796, establishing multiple client republics out of the Italian states. In 1806 he proclaimed himself King of Italy, a country that consisted of Veneto, Lombardy, Modena and the northern Papal States. It was less than half the size of modern Italy but nevertheless the first modern concept of a united Italian state. After Naloleon's defeat it was dissolved and the situation of two decades earlier was mostly restored.
Flag of the Kingdom of Italy (1806-1814)
Italian awakening and unification (1814-1870)
Austria became the largest winner of the post-Napoleonic era. It controlled vast parts of Northern Italy either directly or indirectly. The early stages of industrialisation in Italy took place predominantly in these territories, and this can still be seen today, as the economic differences between Northern and Southern Italy are substantial.
Napoleon had sparked the notion of a unified Italian nation which inspired many revolutionary movements of the 19th century. This awakening also inspired a new wave of Italian culture, with Italian operas of this era becoming world famous. The incumbent powers tried to contain Italian nationalism by force or by liberalisation, but could not prevent large-scale revolts in 1848. It took more than a year to restore order and dismantle the provisional governments in what was called the First Italian War of Independence.
The events of 1848 only strengthened Italian nationalism, but it changed the idea of how to realise it. Earlier republican attempts had failed, and the idea of an Italian monarchy gained support. The Kingdom of Sardinia was the most Italian of the Italian states, but on its own not powerful enough to face the forces of Austria and Spain. France on the other hand, which had deposed its Bourbon monarchy in 1848 and had become an empire under Napoleon III in 1852, was willing to ally itself with Sardinia for a campaign against Austria in 1859. In return for support, France received the city of Nice (Italian: Nizza).
French and Sardinian forces defeated Austria in the Second Italian War of Independence, which brought Lombardy under Sardinian control. Nationalist groups across Italy started revolting, with the northern Italian states of Parma, Modena and Tuscany electing the Sardinian King Victor Emanuel II as its monarch in 1859 and joining the bid for unification. In the south, Sardinian general Giuseppe Garibaldi landed an expedition force on Sicily in 1860. He became the national hero of Italy by leading the revolt against the Bourbon Kings of the Two Sicilies and securing it for the unification. The Papal States were left in Central Italy, dividing the new nation in two. It was agreed with France to annex the eastern part to create a corridor, but leave Rome and its Latium province as a protectorate of France. The result was the proclamation of the Kingdom of Italy in 1861 under Victor Emanuel II, with Florence as its capital.
Italian states and the years they were absorbed in the unification process. The Kingdom of Sardinia ceded the striped areas to France in return for military support against Austria.
The next mission of the newly formed kingdom was to include Venetia from Austria and make Rome (protected by France) its capital. For this, support from Prussia proved crucial. The Austro-Prussian War of 1866 gave the Italians the opportunity to conquer Venetia from Austria. And the Franco-Prussian War of 1870-1 left the remainder of the Papal States defenseless as French troops were relocated. After a short battle Rome was taken and made capital of Italy. Pope Pius IX refused to accept the situation leaving him isolated in the Vatican. The Lateran Treaty in 1929 would solve the situation by establishing the Vatican City as a souvereign state.
Italy from 1870 until 1922
The rule of Victor Emanuel II lasted until 1883 and was in many ways successful. His successor Umberto was very authoritatian and frequently clashed with progressive opponents. He was assassinated in 1900 and his short-statued son Victor Emanuel III became king. He was a staunch numismatist and ordered the creation of the Codex Nummorum Italicorum (CNI), a catalogue of Italian coins which is still a great resource today.
This was also the period that Italy extended its colonial empire. Italian Somaliland and Eritrea were established in 1891. And after a brief war with the Ottoman Empire in 1911 Libya became an Italian dependency.
At the start of the First World War, Italy was allied with Germany and Austria-Hungary, although the relationship with Austria was an uneasy one as South Tyrol, Littoral and Dalmatia were Austrian territories claimed by Italy. In 1915 Italy switched sides to the Allies with the promise of territorial gains. For three years Italy fought the Austrians in the Alps suffering heavy losses, but won the front in October 1918, weeks before the Armistice of November 1918 that ended the Great War. Italy received South Tyrol and Littoral but not Dalmatia, except for the city of Zara (Zadar), putting Italy at odds with its new Yugoslavian neighbour.
Fascist Italy (1922-1943)
Italian nationalists were discontent with the result of the First World War and joined the National Fascist Party of Benito Mussolini, a former communist. Fearing a socialist revolution, Italian liberals started supporting Mussolini. In 1922 Mussolini took power after Victor Emanuel III appointed him as prime minister despite a failed coup attempt. Within years Mussolini established a dictatorship.
Mussolini's ideology was based on nationalism, unity, strong leadership and disregard for individualism and weaker parts of society. Society needed to be strong and ambitious. Italy industrialised rapidly during this era, for which Mussolini was praised internationally and it inspired German national-socialism and the Franco's national movement in Spain. What does need to be noted is that Mussolini favoured unity without the racial ideology that dominated German national socialists. Mussolini suppressed political opponents rather than ethnicities, as long as they followed his ideal of a strong Italy.
Map of interwar Italy with contested regions (in those days) in green. Italy had received Venezia-Tridentina (South Tyrol) and Venezia-Giulia (Littoral) from Austria after World War I, but Italian nationalists also claimed Dalmatia, Ticino and Nice. During WW2 Italy annexed Nice and Dalmatia (as well as other parts of Yugoslavia) but was forced to return them in 1943. The Littoral region was ceded to Yugoslavia after WW2, with the exception of Trieste, which remained Italian. Italians remaining in Yugoslav territory mostly migrated to Italy. The German-speaking majority of South Tyrol have far reaching autonomy but the area is still subject to some controversy even today. Corsican separatists have at times challenged the French authorities but it was never a huge focus for Italian nationalists.
Italy's history of the Roman Empire and the wealth and power of the maritime republics of Genoa and Venice inspired nationalists of an expansionist agenda. The prime focus was the Dalmatian coast which had become Yugoslav in 1918, with the exception of Zara (Croatian: Zadar). The city of Fiume (Croatian: Rijeka) was occupied by Italy in 1918 and a deal was struck with Yugoslavia to govern it as a free city state. Mussolini wanted Italy to become the most powerful state in the Mediterranean and promoted the active colonisation of Libya and annexed Albania in 1939. In Africa, Italy conquered Ethiopia in 1936 and merged it with Eritrea and Italian Somaliland.
Second World War in Italy (1939-1945)
Italy was Nazi Germany's largest ally during WW2, but the relationship between its leaders was uneasy and the Italian campaigns were generally disastrous. German troops often intervened to avert bigger defeats of the Italian army, for example in Greece or North Africa. Italy also took part on the Eastern Front where it sustained heavy losses. Confidence in Mussolini collapsed when Allied troops invaded Southern Italy in 1943. King Victor Emanuel III dismissed Mussolini as Prime Minister and steered Italy to the cause of the Allies. This prompted the Germans to invade Northern Italy establishing the Italian Social Republic as a puppet state under Mussolini's leadership. This situation marked the start of the Italian Civil War between fascists on the Axis side and communist partisans and royalist conservatives on the Allied side.
The Allies advanced gradually north with the assistance of partisans controlling certain areas within the Italian Social Republic, which collapsed in April 1945. Benito Mussolini was captured and shot by partisans. His body was hanged on display in Milan which is shown on a world famous photograph illustrating the final stages of World War 2. After the war Italy had to give up its overseas territories and ceded most of the Littoral region to Yugoslavia but retained the contested city of Trieste. There were many hostilities between the Italian and Yugoslav forces with considerable civilian casualties on both sides.
Italian Republic (1946-date)
The role of Victor Emanuel III during Mussolini's regime made him very impopular, and his move to defect Italy to the Allied side was seen as opportunistic rather than brave. In a last attempt to save the monarchy he abdicated in favour of his son Umberto II in 1946, but Umberto's reign ended quickly as the monarchy was abolished after a referendum. Italy became a parliamentary republic.
Despite numerous unstable cabinets and prime ministers, Italy's economy grew rapidly during the after war years. Italy's north became as wealthy as Southern Germany, but the south part of the country remained far behind. By 1990 Italy's GDP surpassed that of the UK. But since that period Italy's economy has underperformed other European countries. Reasons cited for this are a combination of inflexible labour laws, low birthrates resulting in a shrinking labour force, and lack of exchange rate flexibility that was frequently used in the 1970's and 80's to counter recessions. Italy's banking system and public finances require a larger devaluation of its currency than ECB president Mario Draghi (an Italian) could so far deliver. Italy will be key for the survival of the Euro.
Despite its many political and economical challenges Italy is a popular destination for tourists. It has an abundance of cultural heritage sites spread all over the country. Rome, Venice and Tuscany are the most popular, but many other places are definitely worth visiting. Needless to say that the food is almost always great.
Currency
Most Italian states used the Lira as prime unit of account, derived from the Carolingian monetary system that was introduced around 800 AD. It was subdivided in 20 Soldi each of 12 Denari and was the same as was used in the UK until decimalisation. The first Italian Lira was introduced by the French for the Kingdom of Italy (1806-1814). This currency was at par with the French Franc and subdivided in 100 Centesimi or 20 Soldi. It replaced a variety of currencies used in Northern Italy at various exchange rates.
Unification and Latin Monetary Union (1861-1919)
After Napoleon's defeat in 1814 the Kingdom of Sardinia kept its Lira pegged to the French Franc. As Sardinia became the dominant state driving the unification this currency became the second Italian Lira in 1861. All its coins were minted according to the standards of the Latin Monetary Union which was used in many southern European countries and remained mostly the same until the end of World War I. The 5 Centesimi coin was often named Soldo and the 5 Lire coin Scudo, due to the previously used coin systems in Italy.
The exchange rate did fluctuate a bit but the LMU peg held more or less until 1918. A US Dollar was 5.18 Lire and a British Pound 25.22 Lire. The Lira was at par with the currencies of Spain, France, Switzerland and many other countries.
Interwar years (1920-1943)
The high cost of World War I forced Italy off the gold standard and devalue to an official rate of 19L/$. In effect the Lira traded closer to 25L/$, a devaluation of 80%. All coins except the 20 Centesimi were updated to reflect the lower value. Silver coins of 5, 10 and 20 Lire were introduced in 1927, with the 20 Lire being relatively rare and frequently counterfeited. After Victor Emanuel III became emperor new designs were introduced in 1939. Coin production ceased in 1943 due to the chaos caused by the Allied and German invasions.
Republican era (1946-date)
Coin production was resumed in 1946, with aluminium 1, 2, 5 and 10 Lire. The currency's value dropped sharply in those years to 625 Lire per US Dollar in 1949. Consequently it was worth 156 Lire per Deutschmark. A new coinage was introduced in 1950 with smaller designs, with base metal 20, 50 and 100 Lire and silver 500 Lire coins added a few years after.
With the collapse of the Bretton Woods system in 1973 all currencies started floating, causing Deutschmarks to appreciate versus Dollars and Italian Lira to depreciate. By 1988 a Deutschmark had appreciated to around 800 Lire. It allowed Italy to remain competitive in its exports and the debt to GDP ratio manageable. New 200 Lire and bi-metallic 500 Lire were added in those years. In 1990 the size of 50 and 100 Lire coins was reduced. Smaller denominations were phased out. In 1997 bi-metallic 1000 Lire coins with a map that still showed a divided Germany were introduced. This rather embarassing error was corrected a year later.
Despite multiple failures to fix the Lira to the European Monetary System (EMS) and another devaluation to 990 Lire per DM in 1996, Italy was admitted to the Eurozone, replacing the Lira with the Euro in 1999 at a rate of 1,936.27 Lire. This also removed the need for a redenomination which somehow never happened.
Italy's Euro coins are among the prettier ones, but its Euro membership is controversial in some circles, as Italy's economy has consistently underperformed ever since. In 2011 Italy was close to an outright financial crisis, but intervention by Italian ECB president Mario Draghi has for now helped to remove the pressure. Italy's public debt is very high but the net worth of Italian households is also very high. This does not mean there aren't any risks, as the aging population, sluggish economy and political deadlock could still jeopardise financial stability in Italy.
Coins of the Napoleonic Kingdom of Italy (1806-1814):
https://en.numista.com/catalogue/italie_etats-6.html#devise410
Coins of Italy (1861-date)
https://en.numista.com/catalogue/italie-1.html
Coins of Italian Albania (1939-1944):
Italian Albania
Italian Somaliland (1889-1936):
https://en.numista.com/catalogue/somalie_italienne-1.html
Italian Eritrea (1890-1936):
https://en.numista.com/catalogue/erythree-1.html#devise730
Italian East Africa used Italian coins and modified banknotes. The UK took control of Italy's colonies in 1941 and introduced the East African Shilling in its territories. Libya switched to Pound Sterling after Italy was defeated in North Africa.
