San Marino - Domestic policy

In addition to the sale of postage stamps and revenues from tourism, San Marino receives an annual budget subsidy from the Italian government stemming from the 1862 customs union agreement formed between the two countries. In exchange for this subsidy, San Marino relinquishes the rights to free transit of imports through Italian ports; the printing of paper currency and notes; the operation of commercial radio and television stations; and tobacco cultivation and production of other goods protected by Italian state monopoly. San Marino's trade policy is essentially governed by its customs union with Italy. A 1987 amendment to the relationship allows San Marino banks the right to conduct financial operations directly with foreign banks rather than via the Bank of Italy as was previously required. It also reinstates San Marino's right to operate a casino. This is a venture over which public opinion is divided. Some prefer to keep San Marino traditional, and others are eager to expand its tourist potential. In the late 1990s, San Marino came under pressure from the governments of Italy, the United Kingdom (UK), and the United States to enforce a law enacted in 1997 against music piracy.

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