Narrative tenses using the Past Progressive
"The past progressive is used to describe a situation in which one event is occurring over a period of time and another event either interrupts it or occurs during the time at which the first event is occurring.Eg. "The man was running along the road when a car hit him"
We generally don't start a paragraph with "It" merely on the basis of a heading. If the paragraphs are short, perhaps "This" would be appropriate.
Spain is a big country in southern Europe. - OK
This is an island off the coast of continental Europe. - OK (grammatically)
It is also a big country, in Asia. - No. Use "China" or "This".
PS: Sorry about the spacing. This editor has a mind of its own lately.