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The Vatican is in the middle of Rome and Rome is in Italy, and above all the pope audience are mostly Italians.
And by the way, The pope is usually a cardinal and not a priest, who has been selected by cardinals.
No disrespect intended; yet, Cardinals/Monsignors are still Priests and although geographically the Vatican is surrounded by Rome, Italy, it happens to be classified as its own country and it is also the smallest country on the 3rd Rock from our Sun.