Venice had lost much of the income from its former role in the spice trade. Portuguese access to the Indian Ocean diverted trade that had passed through the Levant, while Ottoman expansion further weakened the Venetian commercial system. Those losses coincided with the expense of replacing galley-era forces and infrastructure with sailing-warship capabilities. Decades of warfare had further exhausted the republic before the French arrival. Campo Formio transferred much of Venice's mainland territory and the city itself to Austria. France retained the Ionian Islands as a prospective gateway towards the Levant, Egypt, and India, hoping to revive routes that could circumvent the British blockade.
Chapter · 17:36-23:42
Campo Formio and France's Ionian gateway
The Treaty of Campo Formio dismantled Venice, but France retained the Ionian Islands as a route toward the eastern Mediterranean.