The economic reports of the Bank of Italy branches still operating in Eritrea and Ethiopia are an excellent and complete source for a better understanding of the economic and social situation in thet region, in the years before and after the estabilishment of the federation. These reports show until the UN resolution and even later, the economic and social situation deteriorated further, dragging Eritrea into a ste of permanet instability. Of course, this documentation together with other types of information such as newspapers of the time, reports of the chamber of commerce of Eritrea and Ethiopia, personal documents of eminet personalities of the time, helped to reconstruct the historical and economic scenario.