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Italy officially the Italian Republic , is a unitary parliamentary republic in Southern Europe. To the north, Italy borders France, Switzerland, Austria, and Slovenia, and is roughly delimited by the Alpine watershed, enclosing the Po Valley and the Venetian Plain. To the south, it consists of the entirety of the Italian Peninsula and the two biggest Mediterranean islands of Sicily and Sardinia, in addition to many other smaller islands.
The sovereign states of San Marino and the Vatican City are enclaves within Italy, while Campione d'Italia is an Italian exclave in Switzerland. Italy covers an area of and has a largely temperate climate. With 61 million inhabitants, it is the 5th most populous country in Europe. Among the world's most developed countries, Italy has the 4th-largest economy in the European Union, 3rd in the Eurozone and 8th in the world by GDP (IMF, 2014).
After the development of the Nuragic, Etruscan and Magna Graecia cultures among others, Italy's capital and largest comune, Rome, has for centuries been the leading political and religious centre of Western civilisation, serving as the capital of both the Roman Empire and Christianity. During the Dark Ages, Italy endured cultural and social decline in the face of repeated invasions by Germanic tribes, Byzantines, Muslims and Normans, with Greco-Roman heritage being preserved largely by Christian monks. Beginning around the 11th century, various Italian cities, communes and maritime republics rose to great prosperity through shipping, commerce and banking (indeed, modern capitalism has its roots in Medieval Italy); concurrently, Italian culture flourished, especially during the Renaissance, which produced many notable scholars, artists, and polymaths such as Leonardo da Vinci, Galileo, Michelangelo and Machiavelli. Meanwhile, Italian explorers such as Polo, Columbus, Vespucci, and Verrazzano discovered new routes to the Far East and the New World, helping to usher in the European Age of Discovery. Nevertheless, Italy would remain fragmented into many warring states for the rest of the Middle Ages, subsequently falling prey to larger European powers such as the Holy Roman Empire, France, Spain, and later Austria. Italy would thus enter a long period of decline that lasted until the beginning of the 18th century.
After many unsuccessful attempts, the second and the third wars of Italian independence resulted in the unification of most of present-day Italy between 1859 and 1866. From the late 19th century to the early 20th century, the new Kingdom of Italy rapidly industrialised and acquired a colonial empire becoming a Great Power. However, Southern and rural Italy remained largely excluded from industrialisation, fuelling a large and influential diaspora. Despite victory in World War I as one of the Big Four with permanent membership in the security council of the League of Nations, Italy entered a period of economic crisis and social turmoil, which favoured the establishment of a Fascist dictatorship in 1922. The subsequent participation in World War II, at the side of Nazi Germany and Japan forming the Axis Alliance, ended in military defeat, economic destruction and civil war. In the years that followed, Italy abolished the monarchy, reinstated democracy, and enjoyed a prolonged economic boom, thus becoming one of the most developed nations in the world, with the fifth largest economy by nominal GDP by the early 1990s. Italy was a founding member of NATO in 1949 and one of the Inner Six of the European Community in 1957, which became the EU in 1993. It is part of the Schengen Area, and has been a member of the Eurozone since 1999.
Italy is a major European power able to exert influence on a global scale with membership in prominent institutions or groups such as the UN, the EU, NATO, the OECD, the OSCE, the DAC, the WTO, the G4, G6, G7, G8, G10, G20, the Union for the Mediterranean, the Latin Union, the Council of Europe, the Central European Initiative, the ASEM and the Uniting for Consensus. Italy currently maintains the world's tenth-largest nominal defence budget and is a participant in the NATO nuclear sharing policy. On 1 July 2014, Italy replaced Greece as the seat of the Presidency of the Council of the European Union.