Ah, you are trying to win this contest
This source does little to pin it down:
The southern part of [Italy/Sicily] has been always considered as a less developed area. This area, known as "Mezzogiorno", which was the destination of the "Grand Tour" for travelers and intellectuals, like Goethe, Byron, Stendhal, fascinated by this "paradise inhabited by devils” in the 18th Century.
~found in a paper on the Internet
This source says it is of German origin:
Italy is a paradise inhabited by devils.
This source indicates it was a Frenchman:
A French traveler to Naples in the 1700s is quoted as referring to that city as “paradise inhabited by devils”, a moniker that came to be applied to all of southern Italy and its inhabitants. When we consider the numbers of “devils” who emigrated from that, the saying takes on global meaning.
http://members.tripod.com/~verdicchio/I ... rican.html