1925-1927 - Italian Penetration
Belgrade, in return for aiding Zogu's invasion, expected repayment in the form of territory and influence in Tiranė. It is certain that Zogu promised Belgrade frontier concessions before the invasion, but once in power the Albanian leader continued to press Albania's own territorial claims. On July 30, 1925, the two nations signed an agreement returning the town of Saint Naum on Lake Ohrid and other disputed borderlands to Yugoslavia. The larger country, however, never reaped the dividends it hoped for when it invested in Zogu. He shunned Belgrade and turned Albania toward Italy for protection.
Advocates of territorial expansion in Italy gathered strength in October 1922 when Benito Mussolini took power in Rome. His fascist supporters undertook an unabashed program aimed at establishing a new Roman empire in the Mediterranean region that would rival Britain and France. Mussolini saw Albania as a foothold in the Balkans, and after the war the Great Powers in effect recognized an Italian protectorate over Albania.
In May 1925, Italy began a penetration into Albania's national life that would culminate fourteen years later in its occupation and annexation of Albania. The first major step was an agreement between Rome and Tiranė that allowed Italy to exploit Albania's mineral resources. Soon Albania's parliament agreed to allow the Italians to found the Albanian National Bank, which acted as the Albanian treasury even though its main office was in Rome and Italian banks effectively controlled it. The Albanians also awarded Italian shipping companies a monopoly on freight and passenger transport to and from Albania.
In late 1925, the Italian-backed Society for the Economic Development of Albania began to lend the Albanian government funds at high interest rates for transportation, agriculture, and public-works projects, including Zogu's palace. In the end, the loans turned out to be subsidies.
In mid-1926 Italy set to work to extend its political influence in Albania, asking Tiranė to recognize Rome's special interest in Albania and accept Italian instructors in the army and police. Zogu resisted until an uprising in the northern mountains pressured the Albanian leader to conclude the First Treaty of Tiranė with the Italians in November 1926. In the treaty, both states agreed not to conclude any agreements with any other states prejudicial to their mutual interests. The agreement, in effect, guaranteed Zogu's political position in Albania as well as the country's boundaries. In November 1927, Albania and Italy entered into a defensive alliance, the Second Treaty of Tiranė, which brought an Italian general and about forty officers to train the Albanian army. Italian military experts soon began instructing paramilitary youth groups. Tiranė also allowed the Italian navy access to the port of Vlorė, and the Albanians received large deliveries of armaments from Italy.
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