Portugal, officially The Portuguese Republic, is a country in southern Europe, founded in 1143, occupying a total area of 92,212 km2. The mainland is located on the southwest of the Iberian Peninsula, bordering Spain to the north and east, and the Atlantic Ocean to the west and south. The Portuguese territory includes two autonomous regions: the archipelagos of Madeira and Azores, in the Atlantic Ocean. The archipelago of Madeira is formed by the islands of Madeira and Porto Santo, and the island groups of Desertas and Selvagens; the archipelago of the Azores consists of nine islands, Santa Maria, São Miguel, Terceira, Graciosa, São Jorge, Pico, Faial, Flores, and Corvo, and several islets.
The Portuguese climate is characterized by mild winters and pleasant summers, varying, however, from region to region. In the North precipitation is higher and temperatures are lower, but temperature range is widest in the interior.
To the south of the Tagus, the largest river in the Iberian Peninsula, one can feel the Mediterranean influence, with hot, long summers and short winters with little rainfall. Madeira has a Mediterranean climate with mild and pleasant temperatures all year round, while the Azores have a temperate maritime climate with abundant rainfall.
Portugal has a population of 10,6 million inhabitants (2011) and a population density of 115,4 inhabitants/km2, with higher concentrations along the coastal strip.
Following the establishment of the Republic, a decree of the National Constituent Assembly dated 19 June 1911 approved a new national flag.
The national flag is vertically divided into two colours - dark green and red - with the green on the hoist or flagstaff side. In the centre, superimposed on the colour boundary, is the national coat of arms rimmed in white, over the armillary sphere in yellow and highlighted in black.
The length of the flag is one-and-a-half times the height of the hoist. Two fifths of the total length are green, and the remaining three fifths are red. The emblem occupies half the height and is placed equidistant from the upper and lower borders.
National Anthem: A Portuguesa
Heróis do mar, nobre povo,
Nação valente, imortal,
Levantai hoje de novo
O esplendor de Portugal!
Entre as brumas da memória,
Ó Pátria, sente-se a voz
Dos teus egrégios avós,
Que há-de guiar-te à vitória!
Às armas, às armas!
Sobre a terra, sobre o mar,
Às armas, às armas!
Pela Pátria lutar
Contra os canhões marchar, marchar!
Portugal was founded in 1143, year of the Zamora’s Treaty signing. The treaty, agreed upon by D. Afonso Henriques, the first King of Portugal, and Alphonse the VII of León and Castile, recognized Portugal as an independent kingdom. In 1179 that status was confirmed by Pope Alexander the III.
During the 12th and 13th Centuries, the Portuguese Kings extended the borders, until conquering the Algarve, consolidating a territory almost unchanged until today.
With its borders defined, Portugal started to look inside itself. At the end of the 13th Century, King D. Dinis founded the prestigious University of Coimbra, one of the oldest in Europe. In the most important centers, castles, palaces and cathedrals were built as the territorial administration cemented.
In 1385, following a popular movement, D. João I was acclaimed king, thus beginning the 2nd dynasty. The sons of D. João I and D. Filipa de Lencastre would be praised by Luiz Vaz de Camões ("Os Lusíadas") as a noble generation of great princes (“Ínclita geração, altos Infantes”), for their humanism, education and governing skills.
Amongst them, one was to be known by History as the visionary and leader who made possible one of humanity’s greatest adventures: the Discoveries. Thanks to the impetus of Infant D. Henrique, also known as Henri the Navigator, the Portuguese caravels crossed the seas, putting to use the best scientifically and practical knowledge of those days. During the 14th, 15th and 16th centuries they navigated to Africa, the Far East and the heart of the South American continent. They conquered lands, hoarded wealth and brought to Europe things never seen before.
In 1498 Vasco da Gama discovered the maritime route to India and in 1500 Pedro Álvares Cabral arrived in Brasil. The Portuguese would still reach Oman (1508), Malasia (1511), Timor (1512), China (1513) and Japan (1543). It was also a Portuguese, Fernão de Magalhães (sometimes referred to as Magellan), who planned and commanded, between 1519 and 1522, the first circumnavigation of the Globe.
This might have been the beginning of the globalization. To celebrate this era, particularly the arrival in India, King D. Manuel had the Jeronimos Monastery built (a singular building in which nautical motives are very present) and inserted the armillary sphere in the Portuguese flag.
The small kingdom was then the largest Empire in the world. Portugal brought together wise men and mercenaries, scientists and painters, businessmen and poets, slaves and princes. Such power and wealth awoke the jealousy of other peoples and after the tragic death of the young King D. Sebastião, in a battle at Alcácer Quibir, in the North of Africa, the resultant vacant throne was occupied by Spanish Kings, who united the two states under the same government for 60 years.
In 1640 Portugal had once again a Portuguese King, D. João IV, who restored the country’s independence. In the 18th Century art-lover, absolutist King D. João V ordered the construction, in Mafra, of a giant Convent and palace and, in Lisbon, the Aqueduct of Águas Livres.
However, the luxurious and exotic capital of the kingdom almost completely vanished in 1755 due to a devastating earthquake. It was Marquês de Pombal, Prime Minister of King D. José, who recreated a new Lisbon, monumental and ready to take on the furies of nature.
In the early 19th Century, Napoleon's troops invaded Portugal and the court moved to Brazil, in order to ensure the Portuguese dynastical continuity and independence. Returning 14 years later, in 1821, King João VI found a different country: besides the scars of years of war, the liberal movement had transformed the political landscape. The king’s power was no longer absolute and the first Constitution was close to being approved.
After D. João VI’s death, civil war broke out (1828) between his two sons: D. Miguel, supported by the courts, who opposed the Constitution, and D. Pedro, who defended it, along a liberal vision of the State, but was legally prevented from taking the Portuguese crown as he had declared Brazil’s independence 6 years earlier.
The quarrel would be settled in 1834 with the signing of the “Convenção de Évora Monte” that put an end to military operations and determined a return to a liberal and constitutional version of the monarchy.
Republican ideas started gaining ground and momentum from the end of the 19th century onwards. After the King’s assassination in 1908 and the revolution of October 5th, 1910, a Republic was established. D. Manuel II was the last King of Portugal and Teófilo Braga the first republican Head of State. Manuel de Arriaga was the first elected President of the Portuguese Republic.
After a troubled period and the Portuguese participation at the First World War, a military coup caused the “Estado Novo” to emerge. This was an authoritarian, one party regime dominated by António Oliveira Salazar, who governed the country for almost half a century.
However, on 25 April 1974 the «Carnation Revolution» returned freedom and democracy to the Portuguese, swiftly recognizing the independence of the former African colonies.
Once again inside its original borders, Portugal turned round and faced Europe. In 1986 the country joined the EEC and, since then, the Portuguese have been enthusiastic participants in the construction of a new Europe, without however forgetting their History, their character and their traditions.
The Portuguese economy has undergone profound changes over the past few decades. From the colonialist corporative and protectionist model of the Estado Novo, based on agricultural and industrial production, Portugal progressively began (from the 1970’s onwards) to lift restrictions and open its economy. With the 1974 revolution the country underwent a period of adjustment and continuous modernization of its economic model.
During the 1990s Portugal followed an economic policy determined by the Economic and Monetary Union’s (EMU) convergence criteria. The process of nominal convergence was successfully completed, and the country has been integrated in the Eurozone since its creation in January 1999. This entailed the fulfillment of a set of quantitative criteria aimed at pursuing a rigorous and credible macroeconomic policy.
The structure of the economy has since changed, with a growing dominance of the services sector, similarly to other European partners. In 2018, the primary sector accounted for 2.7% of GVA (comparing to 24% in 1960), and 5.8% of employment; while the secondary sector accounted for 21.9% of GVA and 24.1% of employment. In the same year, the services sector accounted for 75.3% of GVA and 70.1% of employment.
In addition to a higher incidence of the services sector in the economic activity, there has been a significant change in the standard of specialization of the manufacturing industry in Portugal in the past decades: it has modernized, departing from a dependence on traditional industrial activities to a situation in which new, more technological, sectors, have gained weight and a dynamic of growth. In this respect, the automotive and components sector, electronics, energy, pharmaceutics and new information and communication technologies should be highlighted.
The industrial sector, crucial for Europe’s social and economic development in the past, has been losing relevance with the development of the services sector. In Portugal, manufacturing industry went from 18.1% of GDP in 1995, to 13.5% in 2019 - below the 16.5% of the European average in the same year. Thus, industry is now seen as a priority area for the country’s economic recovery and modernization, as part of a green and digital transition, in accordance with the Recovery and Resilience Plan (PRR), approved by the European Commission. This plan, with execution planned until 2026, is based on a significant national industrialization, which takes place in an international context of decarbonization, thus relying on investment in clean hydrogen, in accordance with the European Green Deal, and the Paris Agreement. The national industrialization will thus feature prominently in the plan, taking in consideration, and contributing to the Sustainable Development Goals of the 2020 Agenda, and ensuring a sustainable increase in the quality of life of the population. This need became evident during the pandemic crisis, as a key pillar of a resilient economy, which reduces its dependence on outside forces and exposure to risks of new value-chains disruptions.
In what concerns services, Portugal's geographic position, enjoying the Mediterranean climate moderated by the influence of the Atlantic, as well as its extensive coastal strip, allied to history and culture, support a relevant and growing tourism industry.
Due to the pandemic, and the mobility restrictions, the tourism sector registered a historic decline in 2020. Although its recovery is expected - once the pandemic is overcome and circulation without restrictions returns - the sector is nevertheless highlighted in the PRR, with the goal of modernizing and strengthening the competitiveness of the sector. Indeed, tourism is one of the priority areas for action plans such as the National Strategy for Research and Innovation for Smart Specialization (ENEI) and “Emprego + digital 2025” - a training programme in digital technologies focused on innovation and digital transformation. It also reinforces the reference to the concept of green and blue growth, potential or opportunities linked to ecosystems, hydro systems and the ocean, that is, to "nature-based solutions".
Portugal is among the 50 largest economies in the world, and its growth outlook was positive until 2020. The economic shock resulting from the crisis caused by the SARS-CoV-2 pandemic hampered the country’s economic prospects, by causing a sharp decline in activity. However, today, with the vaccination campaign and supportive public policies, macroeconomic forecasts point to the recovery of the national economy, which should reach pre-pandemic production levels after the 3rd quarter of 2022, according to OECD data.
Sources: AICEP and Banco de Portugal
(Main Economic Indicators updated, from 2016 to 2020)
|Indicator||Unit||2016||2017||2018||2019 Po||2020 Pe|
|Volume Rate of Change||2,0%||3,5%||2,8%||2,5%||-7,6%|
|GDP per Capita||EUR (Millions)||18061,00||19023,00||19952,00||20800,00||19637,00|
|Volume Rate of Change||4,1%||5,3%||4,9%||4,3%||-5,6%|
|Private Consumption||EUR (Millions)||118273,50||122556,25||127737,35||132344,36||125423,43|
|Volume Rate of Change||2,0%||2,6%||2,1%||2,6%||2,6%|
|Public Consumption||EUR (Millions)||17652,07||18264,66||19182,30||20195,23||21151,15|
|Volume Rate of Change||0,8%||0,2%||0,6%||0,7%||0,4%|
|Investment (GFCF)||EUR (Millions)||28893,36||32887,73||35953,44||38839,21||38627,85|
|Volume Rate of Change||3,6%||13,8%||9,3%||8,0%||-0,5%|
|GFCF excluding Construction||EUR (Millions)||14942,324||16625,314||18003,620||18822,468||17211,411|
|Volume Rate of Change||6,5%||11,3%||8,3%||4,5%||-8,6%|
|Gross National Income Per Capita||EUR||17622||18577||19465||20276||19344|
|Activity Rate||% population >15 years||58,4%||58,9%||59,0%||59,1%||58,0%|
|Employment Rate||% active population||51,9%||53,6%||54,9%||55,3%||54,0%|
|Unemployment Rate||% active population||11,1%||8,9%||7,0%||6,5%||6,8%|
|Public Sector Budget Balance||% GDP||-1,9%||-3,0%||-0,3%||0,1%||-5,7%|
|Public Debt||% GDP||131,5%||126,1%||121,5%||116,8%||133,6%|
|Current account balance||EUR (Millions)||2186,1||2537,3||1137,4||820,9||-2377,4|
|HICP-Portugal||Annual Rate of Change||0,6%||1,6%||1,2%||0,3%||-0,1%|
|Labour productivity per person employed (FTE)||Annual Rate of Change||-0,60%||-0,10%||-0,40%||1,10%||3,40%|
|Labour Cost - Wages||Annual Rate of Change||3,60%||6%||6,40%||4,60%||1,10%|
|Labour cost - Per Unit produced (nominal)||Annual Rate of Change||0,80%||2,10%||3,40%||1,80%||9,30%|
Come and embark on an exciting journey and discover Portugal in the West Coast of Europe. A country of contrasts whose diversity is one of its greatest assets. In this welcoming nation you will find magnificent mountains and endless beaches bathed by the Atlantic Ocean and the sun. You will also find grandiose castles and palaces that seem to have come out of a fairy tale. Dive into an unforgettable experience in this country that offers endless recreation landscapes.
Living in Portugal
If you are a foreign citizen and wish to acquire a home in Portugal, the Living in Portugal website, by Turismo de Portugal, contains all the up to date and reliable information produced by official bodies on all the relevant issues, in order to assist you in your decision.
You can find out how to handle the purchase of a home at one single desk, obtain a residence permit or benefit from a beneficial tax regime, among much other information that will help you make your decision.
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