Italy's shows possession, meaning something belongs to or relates to Italy. It can also contract "Italy is" or "Italy has" in informal speech. Context tells if it shows ownership or stands for "is" or "has".
Italy's youngsters complain, apparently, about having to live at home until they are 72 but that's because they spend all their money on suits and coffee and Alfa Romeos rather than mortgages. Jeremy Clarkson
Three cheers for the war. Three cheers for Italy's war and three cheers for war in general. Peace is hence absurd or rather a pause in war. Benito Mussolini
We don't sell a car, we sell a dream. We are Italy's national team. There are many great soccer teams in our country, but there is only one Ferrari. Luca Cordero di Montezemolo
Not only was [Fascist] Italy the first Western country to recognize the Soviet Union in 1924, but the new Soviet art first appeared in the West that year at the Venice Biennale, Italy's premiere art show. Stanley G. Payne
After replacing Giuseppe Bergomi as captain for the 1994 World Cup under his former manager at Milan Arrigo Sacchi, Baresi sustained an injury to his meniscus in Italy's second group match (a 1–0 win against Norway ) and missed most of the tournament. Source: Internet
Along with patrolling, investigative and law enforcement duties, it patrols the Autostrada (Italy's Express Highway network), and oversees the security of railways, bridges and waterways. Source: Internet