I used to live on Sicily in 1991. A lifetime ago. I worked for Club Med and spoke a lot of French. Oh, and I bought a lot of photos by the resident photographer. Now, I had already changed my first name to Mara, leaving the j out, but my last name started with that very letter: j!* So, very soon problems arose. Because the Italians (at least at that time) didn't know the letter j. Well, they knew about it vaguely, but there are no Italian words at all that use the letter j. Or the y and w for that matter. Pretty soon we had struck a deal though: the j would be pronounced i-longua (long i).
So, what does this have to with anything. Well, we do use the j, the y and the w, but we also use the ij as a letter. It has the same place as the y in our alphabet (which is called the grecian ij by the way). Sometimes considered as one and sometimes considered as two letters. When it's at the beginning of a word, it's one letter and both letters should be capitalized. The same with names of towns, rivers or lakes.**
Of course that leaves the question of how it should be pronounced. Quite easy: the same way you would pronounce the 'ei'-sound (like Apartheid). Which proves to be quite difficult for children, do I spell a word with the short ei or the long ij, since there are not really any set rules about them (unless Pepperfly knows better).
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*The letter j in Dutch is pronounced as the letter y in yellow, hence the change of my first name.
**Even though Flemish and Dutch are basically the same, there is a difference in the use of the letter ij. They will only capitalise the first letter, so where we would spell the River IJzer, they spell it Ijzer, even though the sound stays the same.