The transfer of the seat of the…

The transfer of the seat of the imperial government from Nicaea to Constantinople has upset the balance between Nicaea and Thessalonica and reoriented the economy; the defense system in Anatolia has begun to break down.

To the Greeks, Constantinople remains the New Jerusalem; to leave it in foreign hands had been unthinkable.

However, after the dismemberment of the empire by the Fourth Crusade, the city was no longer the focal point of an integrated structure.

It is now more like an immense city-state in the midst of a number of more or less independent provinces.

Although most of the Genoese fleet had survived the Battle of Settepozzi against the Venetian fleet in 1263, their defeat has major political ramifications, as Michael VIII begins to reconsider the alliance with Genoa, which is very costly but has so far brought little in return, chiefly due to the Genoese admirals' timidity.

As a sign of his dissatisfaction, soon after the battle the emperor had dismissed sixty Genoese ships from his service.

The rift between Genoa and the Empire widens further in 1264, when the Genoese podestà in Constantinople is implicated in a plot to surrender the city to Manfred of Sicily, whereupon the emperor expels the Genoese from the city.