PORTUGAL

Portuguese Republic

República Portuguesa

CAPITAL: Lisbon (Lisboa)

FLAG: The national flag, adopted in 1911, consists of a green field at the hoist and a larger red field. At the junction of the two, in yellow, red, blue, and white, is the national coat of arms.

ANTHEM: A Portuguesa (The Portuguese).

MONETARY UNIT: The escudo (e) was replaced by the euro as official currency as of 2002. The euro is divided into 100 cents. There are coins in denominations of 1, 2, 5, 10, 20, and 50 cents and 1 euro and 2 euros. There are notes of 5, 10, 20, 50, 100, 200, and 500 euros. €1 = $1.25475 (or $1 = €0.79697) as of 2005.

WEIGHTS AND MEASURES: The metric system is the legal standard.

HOLIDAYS: New Year's Day, 1 January; Carnival Day, 15 February; Anniversary of the Revolution, 25 April; Labor Day, 1 May; National Day, 10 June; Assumption, 15 August; Republic Day, 5 October; All Saints' Day, 1 November; Independence Day, 1 December; Immaculate Conception, 8 December; Christmas, 25 December. Movable religious holidays include Carnival Day, Good Friday, and Corpus Christi.

TIME: GMT.

LOCATION, SIZE, AND EXTENT

The westernmost country of Europe, Portugal occupies the greater portion of the western littoral of the Iberian Peninsula. Portugal has an area of 92,391 sq km (35,672 sq mi), including the Azores (Açores) Archipelago, and Madeira and Porto Santo. Comparatively, the area occupied by Portugal is slightly smaller than the state of Indiana. The mainland of Portugal extends 561 km (349 mi) n–s and 218 km (135 mi) e–w. Bordered on the n and e by Spain and on the s and w by the Atlantic Ocean, Portugal has a total boundary length of 3,007 km (1,868 mi), of which 1,793 km (1,114 mi) is coastline.

Portugal's capital city, Lisbon, is located on Portugal's west coast.

TOPOGRAPHY

Portugal exhibits sharp topographic contrasts. Although the north is largely lowland or land of medium altitude, the distribution of highlands is unequal north and south of the Tagus (Tejo) River. From north to south, the principal mountain ranges are the Peneda (reaching a maximum height of 1,416 m/4,646 ft), Gerêz (1,507 m/4,944 ft), Marão (1,415 m/4,642 ft), Montemuro (1,382 m/4,534 ft), the Açor (1,340 m/4,396 ft), and Lousã (1,204 m/3,950 ft), all north of the Tagus. The uplands of Beira, traversed by the Tagus on its way to the sea, contain Portugal's highest peak, Estrêla (1,991 m/6,532 ft). Westward lies the low coast of the Beira Littoral. The Tagus and Sado basins lie adjacent to the hilly area of Estremadura and rise to the hills of Alentejo on the east.

The interior lowland of lower Alentejo, farther south, is limited by the hills of Algarve. The south coast, from the mouth of the Guadiana to Cape St. Vincent, is mainly steep, but northward from Cape St. Vincent to the Tagus, including the great Bay of Setúbal and the estuary of the Tagus, the coast is low. North of the Tagus, it rises steeply toward the hills of Sintra, beyond which is a low coast of dunes interrupted by the marshes of Aveiro. Beyond the mouth of the Douro River, the coast is steep all the way to the Spanish frontier and the mouth of the Minho River. The larger rivers—the Minho, the Douro, the Tagus, and the Guadiana—all rise in Spain. The Douro has the longest course in Portugal (322 km/200 mi).

Portugal is located on the Eurasian Tectonic Plate near its southern boundary with the African plate. The region is seismically active, but fortunately, most earthquakes within the last century have been fairly moderate and were primarily centered in the northern part of the country. One of the most destructive earthquakes in history occurred in Lisbon on 1 November 1755 when an 8.7 magnitude earthquake was felt throughout the country and triggered a tsunami. The destruction from these events caused the deaths of about 70,000 people.

CLIMATE

Marked seasonal and regional variations within temperate limits characterize the climate. In the north, an oceanic climate prevails: cool summers and rainy winters (average rainfall 125–150 cm/50–60 in annually), with occasional snowfall. Central Portugal has hot summers and cool, rainy winters, with 50–75 cm (20–30 in) average annual rainfall. The southern climate is very dry, with rainfall not exceeding 50 cm (20 in) along the coast. In Lisbon, the average temperature is about 24°c (75°f) in July and 4°c (39°f) in January. The annual mean temperature in Portugal is 16°c (61°f).

FLORA AND FAUNA

Three types of vegetation can be distinguished in Portugal: the green forests of eucalyptus, pine, and chestnut in the north; the open dry grasslands, interrupted by stands of cork and other types of evergreen oak, in the central areas; and the dry, almost steppelike grasslands and evergreen brush in the south. Few wild animals remain in Portugal. The coastal waters abound with fish, sardines and tuna being among the most common species. As of 2002, there were at least 63 species of mammals, 235 species of birds, and over 5,000 species of plants throughout the country.

ENVIRONMENT

Air and water pollution are significant environmental problems especially in Portugal's urban centers. Industrial pollutants include nitrous oxide, sulfur dioxides, and carbon emissions. In 1996, industrial carbon dioxide emissions totaled 47.9 million metric tons. In 2000, the total of carbon dioxide emissions was at 59.8 million metric tons.

The nation's water supply, especially in coastal areas, is threatened by pollutants from the oil and cellulose industries. Portugal has 38 cu km of renewable water, of which 48% of the annual withdrawal is used to support farming and 37% is for industrial activity. The nation's wildlife and agricultural activities are threatened by erosion and desertification of the land. The principal environmental agencies in Portugal include the Ministry of Quality of Life and the Office of the Secretary of State for the Environment. The nation's basic environmental legislation dates from 1976.

According to a 2006 report issued by the International Union for Conservation of Nature and Natural Resources (IUCN), threatened species included 15 types of mammals, 15 species of birds, 1 type of reptile, 20 species of fish, 67 types of mollusks, 15 species of other invertebrates, and 15 species of plants. Threatened species in Portugal include the Spanish Lynx, rosalia, Mediterranean monk seal, and Spanish imperial eagle. The São Miguel bullfinch and three species of turtle (green sea, hawksbill, and leatherback) were endangered in the Azores. The Mediterranean monk seal and four species of turtle (green sea, hawksbill, Kemp's ridley, and leatherback) were endangered in Madeira. The Madeiran land snail and the Canarian black oyster catcher have become extinct.

POPULATION

The population of Portugal in 2005 was estimated by the United Nations (UN) at 10,576,000, which placed it at number 76 in population among the 193 nations of the world. In 2005, approximately 17% of the population was over 65 years of age, with another 16% of the population under 15 years of age. There were 94 males for every 100 females in the country. According to the UN, the annual population rate of change for 2005–10 was expected to be stagnant at 0.0%, a rate the government viewed as too low. The projected population for the year 2025 was 10,356,000. The overall population density was 115 per sq km (298 per sq mi), with approximately two-thirds of the population living in coastal areas.

The UN estimated that 53% of the population lived in urban areas in 2005, and that urban areas were growing at an annual rate of 0.93%. The capital city, Lisbon (Lisboa), had a population of 1,962,000 in that year. Porto, the next largest city, had a metropolitan population of 1,551,950. These two metropolitan areas account for most of the urban dwellers in the country.

MIGRATION

Portuguese emigration, which decreased from an annual average of 48,000 persons during the decade 1904–13 to 37,562 in 1961, increased sharply after 1963 as a result of acute labor shortages in other European countries, especially in France and the Federal Republic of Germany (FRG). By 1970, it was estimated that more than 100,000 Portuguese were emigrating yearly. Legal emigration to the FRG continued to increase until November 1973, when the FRG suspended non-EC immigration. Overall, more than 130,000 Portuguese emigrated in 1973. Because of the loss of Portugal's African colonies in 1975, an estimated 800,000 Portuguese settlers returned to Portugal. Since then at least 25,000 generally return from abroad each year, mostly from other European countries or America. As of 1989, some 4,000,000 Portuguese were living abroad, mainly in France, Germany, Brazil, South Africa, Canada, Venezuela, and the United States. In 2003, remittances home came to $2.8 billion.

In 2001, Portugal introduced major innovations to its immigration law, together with multiple and flexible visa arrangements, duties were clarified and the legalization process streamlined. Children born to immigrants living in the country legally for at least six years would automatically be granted citizenship. In 2003, Ukrainians displaced Brazilians as the dominant nationality. There were 466,000 legal migrants at the end of 2004, including 52,037 Africans. In 2004, there were a total of 377 refugees and no asylum applications were filed. In 1999 the net migration rate was -1.51 migrants per 1,000 population; by 2005 it was an estimated 3.49 per 1,000 population.

ETHNIC GROUPS

The Portuguese people represent a mixture of various ethnic strains. In the north are traces of Celtic influence; in the south, Arab and Berber influence is considerable. Other groups—Lusitanians, Phoenicians, Carthaginians, Romans, Visigoths, and Jews—also left their mark on the Portuguese people. The present-day Portuguese population is one of the most homogeneous in Europe. Minority groups are primarily made up of immigrants, both legal and illegal, from Brazil, African colonies, and Eastern Europe. Legal immigrants account for about 5% of the total population. There are about 50,000 Roma in the country.

LANGUAGES

Portuguese, the national language, evolved from ancient dialects of Latin; its rules of orthography were reformulated in 1911. Portuguese is also the official language of Brazil and the former African provinces. Mirandese is a second official language, but is not as widely used. Spanish, French, and English are the most common second languages.

RELIGIONS

According to 2004 reports, about 80% of the population aged 12 or older identified themselves as Roman Catholic; though many claimed that they are not active participants in the church. Protestants constituted about 4% of the populace; and various other groups made up about 1%. Nearly 3% claimed no religious affiliation. Christian groups include Seventh-Day Adventists, the Church of Jesus Christ of Latter-day Saints, Orthodox Christians, and Brazilian syncretic Catholic churches. There are about 35,000 Muslims, 700 Jews, and small groups of Buddhists, Taoists, and Zoroastrians. About 7,000 people are Hindus. There are also congregations of the Igreja Universal do Reino de Deus (the Universal Church of the Kingdom of God), which originated in Brazil. The Church of Scientology claims to have about 200 active members.

In 2001, a new law on religious freedom was passed to extend to minority religions more of the privileges previously granted only to the Roman Catholic Church. The Catholic Church has, however, maintained a special status with the government through a 1940 concordat which was amended in 2004. Certain Catholic holidays are recognized as national holidays.

TRANSPORTATION

The Portuguese railways are almost entirely owned and operated by the state-owned Portuguese Railway Company. As of 2004, the railway system, which is adequate for Portugal's needs, totals 2,850 km (1,771 mi) of broad and narrow gauge track. Of that total, broad gauge accounts for 2,576 km (1,602 mi), of which 623 km (387 mi) have been electrified.

The length of usable highways in 2002 was 17,135 km (10,657 mi), of which 14,736 km (9,165 mi) were paved, including 1,659 km (1,031 mi) of expressways. The principal highways connect Lisbon and Porto with La Coruña in Spain, and Lisbon with Madrid via Badajoz. Bus service links all Portuguese cities, towns, and principal villages. In 2003 there were 5,241,100 motor vehicles registered in continental Portugal, including 3,966,000 passenger cars, and 1,275,100 commercial vehicles.

As of 2005, the Portuguese merchant fleet had 114 oceangoing vessels of 1,000 GRT or more, totaling 872,557 GRT. The main shipping firm is the Portuguese Maritime Transport Co., created after the private shipping companies were nationalized in 1975. It maintains scheduled services to the Azores, Madeira, Macao, and the former overseas territories in Africa. There is also regular service to Brazil and North America. The chief ports—Lisbon (the largest), Porto, Ponta Delgada, and Sines—are all fully equipped and have adequate warehousing facilities. Portugal has created a captive register of convenience on Madeira for Portuguese-owned ships, allowing for taxation and crewing benefits. As of 2003, Portugal's internal waterway system consisted of a 210 km (130 mi) stretch on the Douro River from Porto.

In 2004, Portugal had an estimated 65 airports, 42 of which had paved runways as of 2005. Because of their geographical position, Lisbon's Portela Airport and Santa Maria in the Azores are of great importance in international aviation. Portela is one of the principal airports for overseas flights to North and South America and to western and central Africa; Santa Maria is a stopping point for transoceanic flights from Europe to North America. The most important aviation company in Portugal is Transportes Aereos Portugueses (TAP), which was nationalized in 1975. In 2003, about 7.590 million passengers were carried on domestic and international scheduled flights.

HISTORY

Portugal derives its name from ancient Portus Cale (now Porto), at the mouth of the Douro River, where the Portuguese monarchy began. The country's early history is indistinguishable from that of the other Iberian peoples. Lusitanians were successively overrun by Celts, Romans, Visigoths, and Moors (711). In 1094, Henry of Burgundy was given the county of Portugal by the king of Castile and León for his success against the Moors; his son, Alfonso I (Alfonso Henriques), became king and achieved independence for Portugal in 1143, beginning the Burgundy dynasty. By the mid13th century, the present boundaries of Portugal were established, and Lisbon became the capital.

During the reign of King John (João) I, the founder of the powerful Aviz dynasty and husband of the English princess Philippa of Lancaster, the Portuguese defeated the Spanish in a war over the throne (1385), established a political alliance with England (by the Treaty of Windsor in 1386) that has endured to the present day, and inaugurated their most brilliant era. Prince Henry the Navigator (Henrique o Navegador), a son of John I, founded a nautical school at Sagres, where he gathered the world's best navigators, cosmographers, geographers, and astronomers and commenced a series of voyages and explorations that culminated in the formation of the Portuguese Empire. In the 15th and 16th centuries, the golden age of Portugal, Portuguese explorers sailed most of the world's seas; made the European discovery of the Cape of Good Hope, Brazil, and Labrador; founded Portugal's overseas provinces in western and eastern Africa, India, Southeast Asia, and Brazil; and poured the vast riches of the empire into the homeland. In 1580–81, Philip II of Spain, claiming the throne, conquered Portugal and acquired its empire, but national sovereignty was restored by the revolution of 1640 and the accession of John IV, founder of the Bragança dynasty, to the Portuguese throne. John IV ushered in Portugal's silver age, the 17th and 18th centuries, when the wealth of Brazil once more made Lisbon one of the most brilliant of European capitals. The city was largely destroyed by a great earthquake in 1755 but was subsequently rebuilt. During the Napoleonic wars, Portugal, faithful to its British alliance, was the base of British operations against the French in the Iberian Peninsula. The royal family, however, withdrew to Brazil, and from 1807 to 1821, Río de Janeiro was the seat of the Portuguese monarchy. In 1822, Brazil, ruled by Pedro, the son of King John VI of Portugal, formally declared its independence; Pedro became Emperor Pedro I of Brazil but was deposed in 1831.

The Bragança dynasty, which had ruled Portugal since 1640, came to an end with the revolution of 1910, when the monarchy was replaced by a republican regime. Lack of stability under the new republic led to a military dictatorship in 1926. Marshal António Carmona served as president from 1926 to 1951. António de Oliveira Salazar, brought to the government in 1928 as minister of finance, emerged as Portugal's prime minister in 1932. In 1933, Salazar proclaimed a new constitution, which consolidated his regime and established Portugal as a corporative state. During World War II, Portugal supported the Allies but did not take part in combat; it subsequently became a member of NATO.

Despite its reduced status as a European power, Portugal attempted to maintain its overseas empire, especially its resourcerich African provinces. In 1961, Portugal surrendered Goa, Daman, and Diu to India. In the same year, uprisings in Angola began, organized by the Union of Angolan Peoples in protest against Portugal's oppressive policies in the territory. These uprisings led to serious disagreements between the UN and Portugal; following Portugal's refusal to heed its recommendations for liberalization of policies with a view toward eventual self-government, the UN General Assembly passed a resolution in 1965 calling for a worldwide economic and arms boycott of Portugal in order to force it to grant independence to its African dependencies. Subsequently, the Assembly passed a number of resolutions condemning Portugal for its policies in its African territories. Meanwhile, guerrilla movements in Angola, Mozambique, and Guinea-Bissau were met by a steadily increasing commitment of Portuguese troops and supplies.

Salazar, who served as prime minister of Portugal from 1932 to 1968, died in July 1970 at the age of 81. When he was incapacitated in September 1968, he was succeeded by Marcello Caetano. The unwillingness of the Caetano regime to institute democratic and economic reforms, coupled with growing discontent over the continuance of the ever more costly colonial war in Africa, led to a military coup by the left-wing Armed Forces Movement in April 1974. Broad democratic liberties were immediately granted and opposition political parties legalized, while the corporate state apparatus was gradually dismantled. A decolonization program was also begun, resulting by November 1975 in the independence of all of Portugal's African provinces.

The first provisional coalition government came to power in May 1974, with Gen. António Sebastião Ribeiro de Spínola, whose book Portugal and the Future had played a key role in focusing antiwar sentiment among the military, as president. In September 1974, after a power struggle with the leftist forces, Gen. Spínola resigned and was replaced by Gen. Francisco da Costa Gomes. Following an unsuccessful right-wing coup attempt in March 1975, Gen. Spínola was forced to flee the country, along with a number of officers. The continued dissension between right and left—and between Communist and Socialist factions on the left—was evidenced by the numerous provisional governments that followed the coup. In April 1975, general elections were held for a Constituent Assembly, whose task was to draw up a new constitution. Legislative elections were held in April 1976 and presidential elections in June. Gen. António dos Santos Ramalho Eanes was elected president, and the leader of the Portuguese Socialist Party, Mário Alberto Nobre Lopes Soares, became prime minister. Mainly as a result of policy differences within the governing coalition, this administration fell in July 1978 and was replaced by a caretaker cabinet.

After a succession of different coalitions, the Socialist Party won a 35% plurality in the parliamentary elections of April 1983, and Soares was again named prime minister, forming a coalition government with the center-right Social Democratic Party (Partido Social Democratico—PSD). Political turbulence increased after the election, and in 1984, urban terrorism appeared. In the following year, Portugal entered the EC, boosting the economy. Political instability continued, however, and a general election was called in October 1985. The vote brought the PSD to power with a slim plurality; Prof. Aníbal Cavaço Silva was able to form a minority government. In 1986, four candidates ran for president; none was able to win a majority, and in the ensuing runoff election, former Prime Minister Soares won a narrow victory to become the nation's first civilian president in 60 years. In 1987, the government lost a vote of confidence, and Soares called a general election; the PSD under Silva won a majority in the Assembly, achieving the first such government since democracy was restored in 1974.

The PSD was returned to power in 1991 and Mário Soares was reelected president for a second five-year term on 13 January 1991. Economic recession, government deficits, and regional development initiatives were major concerns in the 1990s.

Following the success of the Socialist Party (Partido Socialist—PS) in the legislative elections held in October 1995, Socialist Jorge Sampaio defeated Silva to succeed Soares as president on 14 January 1996. (Sampaio won reelection for a second five-year term in January 2001.) Antonio Guterres was reappointed prime minister. The goal of the Guterres government was to prepare Portugal for entry into the European economic and monetary union. Successive austerity measures were legislated, with the support of the center-right PSD, to guarantee Portugal's participation in the euro zone (this took place in 1999). The socialist government at the same time presided over a remarkable economic recovery after 1996. Thanks to strong economic growth and a real drop in unemployment, the PS retained power after the 10 October 1999 Assembly elections. Its program for the succeeding four years was to speed up Portugal's economic and bureaucratic modernization in order to attract investment and promote export-led growth.

The Socialist government's ability to manage a slowing economy deteriorated in Guterres' second term, and the PS suffered a major defeat in local elections held in December 2001. Guterres resigned, and early elections were held in March 2002. They resulted in a change in government, with the center-right PSD forming a coalition with the conservative Popular Party. PSD leader José Manuel Durão Barroso was named prime minister. Durão Barroso experienced his own troubles with the economy, as Portugal headed into a recession at the end of 2002 and into 2003. Portugal's economy was forecast to grow by 0.4% in 2003, the worst performance in the euro currency zone. As well, Portugal's budget deficit in 2002 was far above the 3% of GDP limit established by the EU's Growth and Stability Pact, putting it in jeopardy of punitive sanctions from the EU. In 2005, GDP growth was forecast at just 0.5%, and the budget deficit was 6.8% of GDP.

Portugal's overseas possession, Macau, was turned over to Chinese administration on 20 December 1999. Portugal supported independence for its former colony of East Timor; this was achieved in May 2002. Portugal took steps to normalize relations with Indonesia following the independence of East Timor.

Barroso supported the United States in its war in Iraq which began in 2003. The prime minister faced criticism from within parliament and among the Portuguese electorate for his stance. In July 2004, Barroso resigned as prime minister to become president of the European Commission. Pedro Santana Lopes, his successor as leader of the PSD, formed a new government. Four months into Lopes's government, President Sampaio called for early elections amidst growing public dissent over the center-right government's inability to tackle the country's economic problems. The general elections were held in February 2005; the Socialists swept to victory and José Sócrates became prime minister. The Socialists secured their first absolute majority in parliament since democracy returned to Portugal in 1974. Sócrates said his primary objective would be to boost the economy by investing in training and technology. His government had to face the task of bringing the budget deficit under control and putting a stop to rising unemployment.

The government declared a national calamity in August 2003 as forest fires swept across vast areas of woodlands; an area the size of Luxembourg was lost to the fires. At least 18 people were killed, and the damages were estimated at €1 billion. Portugal was plagued by deadly wildfires once again in August 2005. They were said to be the worst in recent times. Portugal appealed to the EU for emergency financial aid to cover the costs to farmers of lost harvests in the wake of the fires.

Presidential elections were held on 22 January 2006. Social Democratic Party candidate and former Prime Minister Aníbal Cavaco Silva won with 50.54% of the vote. Independent candidate Manuel Alegre Duarte came in second with 20.74% of the vote.

GOVERNMENT

A constitution made public on 9 April 1975 and effective 25 April 1976 stipulated that the Armed Forces Movement would maintain governmental responsibilities as the guarantor of democracy and defined Portugal as a republic "engaged in the formation of a classless society." The document provided for a strong, popularly elected president, empowered to appoint the prime minister and cabinet. This constitution was substantially revised in 1982 and later in 1989; the most important new provisions were the elimination of the military Council of the Revolution and the limitation of presidential power. The new government system is parliamentary.

According to the constitution as amended (further amendments were added in 1992, to accommodate the Maastricht Treaty on European Union; in 1997, to allow referendums; and in 2001, to facilitate extradition), the president is elected by popular vote for a five-year term. The president appoints the prime minister and, at the prime minister's proposal, a Council of Ministers. A Council of State advises the president. The main lawmaking body is the unicameral Assembly of the Republic, the 230 members of which are directly elected to four-year terms, subject to dissolution. Suffrage is universal from age 18.

POLITICAL PARTIES

Under the Salazar regime, although the constitution did not prohibit political activity, the National Union (União Nacional) was the only political party represented in the legislature. Candidates of the old Center parties, which had been active prior to 1926–28, were allowed to participate in national elections starting in 1932, although none were ever elected.

After the 1974 revolution, several right-wing parties were banned, and various left-wing parties that had functioned underground or in exile were recognized. Among these was the Portuguese Communist Party (Partido Comunista Português—PCP), which was founded in 1921 and is Portugal's oldest political party. It is especially strong among industrial workers and southern farm workers. The government also recognized the Portuguese Socialist Party (Partido Socialista Português—PSP), founded in exile in 1973, and the Popular Democratic Party (Partido Popular Democrático—PPD), formed during the Caetano regime; both the PSP and the PPD favored the establishment of a Western European-style social democracy. Tied to the policies of the Caetano regime was the Social Democratic Center (Centro Democrático Social—CDS), founded in 1974, which held its first conference in January 1975 and became a target for left-wing disruptions. In June 1976, Gen. António Ramalho Eanes, the army chief of staff, who was supported by the major non-communist parties, won election as Portugal's first president.

In 1979, the right-of-center Democratic Alliance (Aliança Democrática—AD) was formed by the Social Democratic Party (Partido Social Democrático—PSD), founded in 1974; the CDS; and the People's Monarchist Party (Partido Popular Monárquico—PPM). The leftist United People's Alliance (Aliança Povo Unido), also formed in 1979, included the People's Democratic Movement (Movimento Democrático Popular—MDP), dating from 1969, and the PCP.

The Republican and Socialist Front (Frente Republicana e Socialista—FRS), formed in 1980, consists of the PSP, the Union of the Socialist and Democratic Left (União da Esquerda Socialista Democrática—UESD), founded in 1978, and Social Democratic Independent Action (Acção Social Democrata Independente—ASDI), founded in 1980. The People's Democratic Union (União Democrática Popular—UDP), dating from 1974, comprises political groups of the revolutionary left.

In October 1985, former President Eanes's centrist Democratic Renewal Party (Partido Renovador Democrático—PRD) entered the ballot for the first time, taking 18% of the vote. In 1991, the seats were distributed as follows: PSO, 135; PSP, 72; CDU, 17; Center Democrats, 5; National Solidarity, 1. The latter was formed in 1990 to address the needs of pensioners.

In the legislative elections of 10 October 1999, the seats were distributed as follows: PS, 114; PSD, 83; CDU, 17; CDS/PP, 15, and Left Bloc, 2. Antonio Manuel de Oliviera Guterres was reappointed prime minister. The first PS victory in October 1995 carried through to the presidential elections of 14 January 1996, when Jorge Sampaio was elected president, with 53.8% of the vote to Aníbal Silva's 46.2%.

Guterres ruled during a downturn in the global economy in his second term, and in December 2001 he resigned following a defeat for the PS in municipal elections. The PSD, led by José Manuel Durão Barroso, won 40.1% of the vote and took 105 seats in parliament in the 17 March 2002 elections, to the PS's 37.9% and 96 seats. The Popular Party (PP) won 8.8% of the vote and secured 14 seats; the PSD formed a coalition government with the PP. Also winning seats were the CDU (Unitarian Democratic Coalition, comprised of the Portuguese Communist Party and the Greens), 7% of the vote and 12 seats; and the Left Bloc (BE—comprised of the communist Democratic People's Union, the Revolutionary Socialist Party, and the extreme left party Politics XXI), 2.8% of the vote and 3 seats.

Sampaio called for early legislative elections in December 2004 because he lacked confidence in the governing center-right government of Pedro Santana Lopes (who became prime minister in July 2004 after Barroso stepped down to become president of the European Commission). The elections were held in February 2005. The results were as follows: PS, 45.1% of the vote (121 seats); PSD, 28.7% (75 seats); CDU, 7.6% (14 seats); PP, 7.3% (12 seats); BE, 6.4% (8 seats). The next elections were scheduled for February 2009.

LOCAL GOVERNMENT

Portugal is grouped into districts, including 18 on the mainland and the autonomous regions of the Azores and Madeira islands. Each district has a governor, appointed by the minister of the interior, and an assembly. There are more than 300 municipalities, subdivided into parishes.

JUDICIAL SYSTEM

Justice is administered by ordinary and special courts, including a Constitutional Tribunal; the Supreme Court of Justice in Lisbon, consisting of a president and some 60 judges; five courts of appeal, at Lisbon, Porto, Coimbra, Évora and Guimarães; courts of first instance in every district; and special courts. The jury system was reintroduced in 1976, but it is used only when requested by either the prosecutor or the defendant.

The judiciary is independent and impartial. Citizens enjoy a wide range of protections of fundamental civil and political rights which are outlined in the constitution with specific reference to the Universal Declaration of Human Rights. An Ombudsman, elected by the Assembly of the Republic (legislature) to a four-year term, serves as the nation's chief civil and human rights officer.

The legal system is based on the civil law system. Portugal accepts compulsory jurisdiction of the International Court of Justice with reservations.

ARMED FORCES

As of 2005, the total armed forces of Portugal numbered 44,900 active personnel. Reservists numbered 210,930 for all services. The army had 26,700 personnel, with equipment that included 187 main battle tanks, 40 reconnaissance vehicles, 353 armored personnel carriers, and over 350 artillery pieces. The navy had 10,950 active members, including 1,980 marines. The navy operated two tactical submarines, six frigates, and 29 patrol/coastal vessels. The air force had 7,250 active personnel and was equipped with 50 combat capable aircraft, including 19 fighters, two reconnaissance and six maritime patrol aircraft. Paramilitary police and republican guards numbered 47,700. The United States maintains a military presence with 1,008 personnel. Armed forces personnel are deployed to eight different countries either in a support role or as part of UN, European Union or NATO missions. The 2005 defense budget totaled $2.43 billion.

INTERNATIONAL COOPERATION

Portugal joined the United Nations on 14 December 1955 and participates in ECE and several nonregional specialized agencies, such as the FAO, IAEA, the World Bank, ILO, UNESCO, UNIDO, and the WHO. The nation is one of the 12 original signatories to NATO. Portugal is a member of the WTO, the OECD, the African Development Bank, the Asian Development Bank, the Council of Europe, the Euro-Atlantic Partnership Council, the European Bank for Reconstruction and Development, the OSCE, and the Western European Union. Portugal joined the European Union in 1986. It also has observer status in the OAS and the Latin American Integration Association (LAIA).

Portugal has offered support to UN missions and operations in Kosovo (est. 1999), East Timor (est. 2002), and Burundi (est. 2004).

Portugal belongs to the Australia Group, the Zangger Committee, the European Organization for Nuclear Research (CERN), the Nuclear Suppliers Group (London Group), the Nuclear Energy Agency, and the Organization for the Prohibition of Chemical Weapons. In environmental cooperation, Portugal is part of the Basel Convention, Conventions on Biological Diversity and Air Pollution, Ramsar, CITES, the London Convention, International Tropical Timber Agreements, the Kyoto Protocol, the Montréal Protocol, MARPOL, and the UN Conventions on the Law of the Sea, Climate Change and Desertification.

ECONOMY

Manufacturing and construction together accounted for 30.2% of Portugal's GDP in 2004. The largest industries are clothing, textiles, and footwear; food processing; wood pulp, paper, and cork; metal working; oil refining; chemicals; fish canning; wine; and tourism. Agriculture, forestry, hunting and fishing employs about 12.5% of the work force (down from 26.2% in 1971) but contributed about 5.9% of the GDP in 2004. The percent of the labor force in services rose from 39% in 1971 to 52.4% in 2000, accounting for about 63.9% of GDP in 2004. Traditionally, productivity has been hampered by low investment and a lack of machinery and fertilizers. The economy experienced robust growth after 1993, however, primarily due to increased investment and domestic consumption, both in turn traceable to advantages Portugal gained through its entry into the European Community in 1986. In 1986, Portuguese income was about 52% of the EU average; by 2002, GDP per capita on a purchasing power parity basis had risen to over 70% of the EU average. In 2005, it was expected to be 65.1%. Economic growth, which had been above the EU average for most of the 1990s, fell back during 2001–04.

From the end of 1973 through 1983, the energy crisis and insufficient liquidity jeopardized economic growth, which dropped still further following the overthrow of the Caetano regime in April 1974. GNP growth in 1974 fell to 2.3% from 8.1% in the previous year. The decline was caused by a sharp drop in new offers of investment and credit from abroad (investors feared rising Communist influence and government takeovers of private firms), coupled with a decline in tourism and a massive increase in unemployment primarily resulting from the return of Portuguese settlers and soldiers from newly independent Angola. During the late 1970s, Portugal adopted an austerity program and succeeded in lowering inflation to 16.6% and increasing GDP growth to 5.5% in 1980. However, adverse interest and exchange rates and a severe drought during 1980–81 resulted in a resurgence of inflation (an estimated 22.5% in 1982) and sluggish economic growth (1.7% in 1981 and 2% in 1982).

In mid-1983, the Soares government implemented an IMF stabilization plan of drastic internal tightening, which brought steady economic improvement. The persistent current account deficits ended in 1985, partially as a result of the decline in world oil prices and entry into the EC. The Silva government's economic liberalization emphasized competitiveness and accountability. From 1987 to 1999 Portugal was the net recipient of financial inflow from the EU of about $27 billion, most disbursed through the European Regional Development Fund. The money was spent on infrastructural improvements, most notably the highway system. With the accession into the EU of 10 new central and east European countries in 2004, Portugal lost its historic competitive advantage in Europe due to low labor costs in the new EU members.

Through the 1990s, until the beginning of 2001, Portugal enjoyed strong economic growth generally above the EU average. The economy grew 4.2% in 1998, at 3.1% in 1999, and at 3.3% in 2000. Unemployment was at 5% in 1998, but dropped to 4.5% in 1999 and then to 4% in 2000. Even as growth slowed to 2.2% in 2001, unemployment in Portugal remained below most of its neighbors, at 4.2%. In 2002, growth slowed to 0.4% and unemployment increased to 5.05%. Inflation in Portugal has been moderate but growing, increasing from 2.4% in 1998 to 4.6% in 2000. Consumer prices rose 4.4% in 2001 and about 3.7% in 2002. The Socialist government pledged its dedication both to meeting the Maastricht monetary convergence criteria and to increasing social spending, including provision of a guaranteed minimum income. This policy bore fruit when Portugal qualified for the first round of entry into the Economic and Monetary Union (EMU) in 1999. As of January 2002, the euro became Portugal's only official currency. The government's privatization program reduced the public sector to 7.5% of GDP and 2.6% of employment by the end of 1999 from 19.7% of GDP and 5.5% of employment in 1988.

In 2003, the economy was officially in a recession, with the GDP declining by 1.1%. Unemployment shot up to 6.5%. In 2004, real GDP growth was in the positive figures once again, albeit estimated at a paltry 1.1%. Unemployment that year remained at 6.5%. After weak growth in 2005, GDP growth was expected to rise modestly in 2006, to 1%, and to 1.6% in 2007, as domestic demand picked up. Inflation was forecast to remain comparatively low in 2006–07 (the inflation rate stood at 2.4% in 2004), although increases in the rate of value-added tax (VAT) and in excise duties in mid-2005—in addition to high oil prices—was forecast to lead to a sharp increase in inflation in early 2006.

The unofficial, or underground, economy is estimated at 20% of official GDP, about the same level as that of Spain and Italy.

INCOME

The US Central Intelligence Agency (CIA) reports that in 2005 Portugal's gross domestic product (GDP) was estimated at $194.8 billion. The CIA defines GDP as the value of all final goods and services produced within a nation in a given year and computed on the basis of purchasing power parity (PPP) rather than value as measured on the basis of the rate of exchange based on current dollars. The per capita GDP was estimated at $18,400. The annual growth rate of GDP was estimated at 0.7%. The average inflation rate in 2005 was 2.4%. It was estimated that agriculture accounted for 5.2% of GDP, industry 28.9%, and services 65.9%.

According to the World Bank, in 2003 remittances from citizens working abroad totaled $3.024 billion or about $291 per capita and accounted for approximately 2.0% of GDP.

The World Bank reports that in 2003 household consumption in Portugal totaled $74.27 billion or about $7,141 per capita based on a GDP of $147.9 billion, measured in current dollars rather than PPP. Household consumption includes expenditures of individuals, households, and nongovernmental organizations on goods and services, excluding purchases of dwellings. It was estimated that for the period 1990 to 2003 household consumption grew at an average annual rate of 2.8%. In 2001 it was estimated that approximately 29% of household consumption was spent on food, 7% on fuel, 2% on health care, and 19% on education.

LABOR

The labor force in Portugal in 2005 totaled an estimated 5.52 million. As of 2003, the services sector employed 55.8% of the country's workforce, with industry at 32.6% and agriculture at 12.7%. In 2005, the estimated unemployment rate was 7.3%.

As of 2005, workers in Portugal can form and join unions, can engage in collective bargaining and strikes. About 35% of the nation's workforce was unionized as of 2005. Armed forces and police personnel are banned from striking, but they have unions and have legal mechanisms to settle grievances. The government approves all collective bargaining contracts and regulates such matters as social insurance, pensions, hours of labor, and vacation provisions. Strikes are generally resolved quickly through negotiations.

A minimum wage was established in 1975. In 2005, the minimum monthly salary was about $449, which is not sufficient to provide a decent standard of living to a worker and family. However, rent controls and subsidized food and utilities help increase the standard of living. In addition, most workers earn more than this amount. The maximum legal workday is 10 hours, with the workweek set at 40 hours with a minimum of 12 hours between workdays. Overtime is limited to two hours per day up to 200 hours annually. Minimum standards of occupational safety and health are set by law, but they are not adequately enforced and workplace accidents do occur, particularly in the construction industry. The minimum working age is 16 years.

AGRICULTURE

In 2003, 25.3% of the land was considered arable. Of the 2.3 million hectares (5.7 million acres), 74% was cultivated with seasonal crops and 26% was under permanent crops. In 2003, the gross agricultural product accounted for 4% of GDP. Estimates of agriculture production in 2004 included potatoes, 1,250,000 tons; tomatoes, 1,100,000 tons; corn, 798,000 tons; wheat, 251,000 tons; olives, 270,000 tons; rice, 148,000 tons; and rye, 27,000 tons. Production of olive oil reached 30,000 tons in 2004/05. Wine, particularly port and Madeira from the Douro region and the Madeira islands, is an important agricultural export; production totaled 724 million liters in 2004. Portugal is the world's ninth-largest producer of wine, although Portugal's wines are mostly unknown internationally apart from port and rosé. Under the influence of EU policies, vineyard areas have been reduced in recent years. In 2004, the value of agricultural products imported by Portugal exceeded that of agricultural exports by $3.36 billion.

According to government estimates, about 900,000 hectares (2,200,000 acres) of agricultural land were occupied between April 1974 and December 1975 in the name of land reform; about 32% of the occupations were ruled illegal. In January 1976, the government pledged to restore the illegally occupied land to its owners, and in 1977, it promulgated the Land Reform Review Law. Restoration of illegally occupied land began in 1978.

Agriculture is the main problem area of the economy; yields per hectare are less than one-third of the European average, with a severe drought in 1991/92 only exacerbating the problem. The situation has actually been deteriorating since the mid-1970s, with many yields falling and arable and permanent crop areas declining. By 1999, crop output was only 87% of what it had been on average during 1989–91. However, during 2002–04, crop output was down 1.8% from 1999–2001. With the reform of the EU's Common Agriculture Policy (CAP), a significant reduction in the number of producers through consolidation (especially in the north) will result in the end of traditional, subsistence-like based agriculture. Between 1995 and 2003, the number of agricultural holdings decreased from 450,600 to 359,200, while the value of crop output increased from €3.7 billion to €4.33 billion during that time.

ANIMAL HUSBANDRY

The Alentejo region is Portugal's grazing heartland. In 2005, Portuguese livestock population estimates included 5,000,000 sheep, 2,248,000 hogs, and 1,443,000 head of cattle. There were 547,000 goats, 125,000 donkeys, 40,000 mules, 17,000 horses, 35,000,000 chickens, and 7,000,000 turkeys in 2005. Mules and donkeys, as well as horses and oxen, often provide draft power for the farms. The main districts for cattle are northern and north-central Portugal; most of the sheep, goats, and pigs are raised in the central and southern sections. In 2005, Portugal's meat production included an estimated 321,000 tons of pork, 242,000 tons of poultry meat, 119,500 tons of beef and veal, and 22,100 tons of mutton. Other production estimates for 2005 included 2,076,000 tons of milk, 132,450 tons of eggs, 75,600 tons of cheese, and 26,000 tons of butter.

FISHING

Three main fields of activity make up the Portuguese fishing enterprise: coastal fishing, with sardines as the most important catch; trawl fishing on the high seas; and cod fishing on the Grand Banks, off Newfoundland. In 2004, the Portuguese fishing fleet consisted of 10,089 vessels with 112,978 GRT. National fish landings totaled 210,526 tons in 2004, of which aquaculture accounted for 3.6%. Dominant species are sardines, mackerel, red fish, scabbardfish, and octopus. These species accounted for nearly half the landings. Virtually all the total catch is sold fresh, but small amounts of sardines and octopus are frozen. The total catch fell from 375,413 tons in 1973 to 247,596 tons in 1983 but increased to 325,349 tons in 1991. The average annual catch during 1990–94 was 295,007 tons, 318,600 tons during 1995–99, and 205,611 tons during 2000–04. The annual catch declined since the 1990s because Portugal was affected by internationally-set limits (Total Allowable Catches) that restrict fishing access for certain species in the international waters of the North Atlantic and by EU fishing quotas. The fishing potential has also been affected by a reduction in the national fleet in association with EU fleet reduction incentives. The Portuguese fishing fleet was reduced by 40% during 1990–2000. There was an additional 5% reduction in fleet tonnage during 2000–04.

FORESTRY

With about 40% of the total land area forested, Portugal is an important producer of forestry products. The country is the world's leading producer of cork, harvested exclusively from cork oak (Quercus suber ) found predominantly in the Mediterranean region. Portugal ordinarily supplies around 175,000 tons of cork per year (about half of world output) from some 725,000 hectares (1,791,000 acres) of cork forests. Portugal is also an important producer of resin and turpentine. Roundwood production in 2004 was 9,672,000 cu m (341.4 million cu ft), with a sawn wood output of 1,383,000 cu m (48.8 million cu ft). Other commodities produced that year included wood pulp, 1,935,000 tons; paper and paperboard, 1,536,000 tons; and particleboard and other wood-based panels, 1,215,000 cu m (42.9 million cu ft). In 2004, timber and other forest product exports amounted to $1,684 million. Wine stoppers account for 55% of cork export value. Cork demand has fallen in recent years, and production is limited by the botanical fact that a single tree can only be stripped once every nine years. Eucalyptus logs (the crux of the pulp industry) are exported as well; forestation of eucalyptus is a major national controversy, with opponents charging that it displaces traditional farmers and damages the soil and water table. Pine accounts for most lumber exports.

MINING

Portugal's mineral wealth is significant but the deposits are scattered and are not easily exploitable on a large scale. The country's most important metallic mineral resources are copper, tin and tungsten. Portugal is a leading producer of mined copper in the European Union (EU), as well as being an important producer of dimension stone and tungsten concentrates. Minerals were one of the country's dynamic industrial sectors, mainly because of the discovery and development of the Neves-Corvo copper and tin deposits. The Panasqueira mine was one of the world's largest producers of tungsten concentrates.

In 2003, the output of mined copper (metal content) was 77,581 metric tons, up slightly from 77,227 metric tons in 2002. Output of mined tungsten (metal content) was 715 metric tons, compared to 693 metric tons in 2002. Tin mine output (metal content) in 2003 totaled 354 metric tons, down from 574 metric tons in 2002. Production of iron ore and concentrates (gross weight) in 2003 totaled was estimated at 14,000 metric tons, unchanged from 2002. Portugal also produced white arsenic, manganese, silver, uranium, anhydrite, hydraulic cement, refractory clays, diatomite, feldspar, gypsum, kaolin, hydrated lime, quicklime, lepidolite (a lithium mineral), nitrogen, pyrite and pyrrhotite (including cuprous), rock salt, sand, soda ash, sodium sulfate, stone (basalt, dolomite, diorite, gabbro, granite, both crushed and ornamental, graywacke, calcite marl limestone, marble, ophite, quartz, quartzite, schist, slate, and syenite), sulfur, and talc. Marble, mainly from the Evora District, was the most valuable of the stone products. A new deposit, at the Aljustrel mine/mill complex, encompassing five massive sulfide deposits, could be brought into production relatively quickly as a low-cost zinc producer; the most significant deposit, at Feitais, had 12 million tons of proven and probable minable zinc reserves with an average grade of 5.67% zinc, 1.7% lead, and 64 grams per ton of silver, and 1.6 million tons of proven and probable copper ore reserves with an average grade of 2.2% copper, 0.97% zinc, and 14 grams per ton of silver.

The southern Iberian Peninsula, known as the Iberian Pyrite Belt (IPB), was one of the most mineralized areas of Western Europe and was geologically very complex. The IPB's internationally well-known volcanogenic massive sulfide (VMS) deposits, in the southwestern part of the peninsula, dated to the Upper Devonian and the Lower Carboniferous ages. Clusters of deposits occurred around individual volcanic centers, and the largest individual deposit located to date may have held an original reserve of 500 million tons, out of IPB's total resource of 1,725 million tons. Sulfide deposit resources in 1999 were 1,100 million tons.

The government continued its privatization program and was proceeding with legislation to privatize many public companies, part of a broader program to make the economy more market driven. The structure of the mineral industry could change in the near future because of significant mining exploration by several foreign companies, particularly for copper, gold, kaolin, lead, lithium, pyrites, and tin. The IPB was the prime area for exploration activity, and had an above-average potential for success based on an unusually high number of large VMS deposits.

ENERGY AND POWER

Portugal operates two refineries, which allows the country to meet a portion of its refined petroleum product needs. However, the country must import all of the crude oil it refines, as well as additional amounts of refined petroleum products, in addition to all of the natural gas and coal the country consumes.

In 2002, Portugal's two refineries, one at Sines and the other at Porto, had a combined output of 271,740 barrels per day. However, domestic demand for refined oil in that year averaged 343,160 barrels per day. Imports of refined and crude petroleum averaged a combined 355,580 barrels per day, although the country did reexport an average of 28,790 barrels per day.

Natural gas imports and consumption for 2002 totaled 109.83 billion cu ft and 109.26 billion cu ft, respectively. Demand for coal in 2003 was met entirely by imports. Consumption of coal that year totaled 5.9 million short tons, most of which was used to generate electricity.

Portugal's electric generating capacity in 2002 totaled 10.394 million kW, of which hydroelectric capacity accounted for 3.963 million kW, and conventional thermal capacity accounting for 6.217 million kW. Geothermal/other capacity accounted for 0.214 million kW. Total output of electric power in 2002 came to 43.439 billion kWh, of which conventional thermal sources provided 33.633 billion kWh, and hydroelectric 7.722 billion kWh. Geothermal/other provided 2.084 billion kWh. Demand for electric power totaled 42.297 billion kWh.

INDUSTRY

Industry (including construction, energy, and water) employs about one-third of the labor force, and its contribution to the national economy has grown significantly in recent decades. It accounted for 30.2% of GDP in 2004. Industrial production in 2004 had maintained a 1.1% growth rate over 2003. Portuguese industry is mainly light; the development of heavy industry has been hampered by a shortage of electric power. Textiles—especially cottons and woolens—are the oldest and most important of Portugal's manufactures. Other principal industries are automotive assembly, electronics, glass, porcelain, and pottery, footwear, cement, cellulose and paper, rubber and chemicals, cork and cork products, and food industries (mainly canned fish). Small artisan industries, such as jewelry and homespun and hand-embroidered clothing, are of local importance.

Manufactured goods in the early 2000s included cement, wood pulp, crude steel for ingots, paper and paperboard, and radios and televisions. In 2005, footwear, textiles, wood and cork, chemicals, paper, and food and beverages (wine) were the central industries. In addition, the country has increased its role in Europe's automotive sector, and has a fine mold-making industry.

Foreign competition has cut into Portugal's textile industry. Following the expiration of the World Trade Organization's longstanding system of textile quotas at the beginning of 2005, the EU signed an agreement with China in June 2005, imposing new quotas on 10 categories of textile goods, limiting growth in those categories to between 8% and 12.5% a year. The agreement runs until 2007, and was designed to give European textile manufacturers time to adjust to a world of unfettered competition. Nevertheless, barely a month after the EU-China agreement was signed, China reached its quotas for sweaters, followed soon after by blouses, bras, T-shirts, and flax yarn. Tens of millions of garments piled up in warehouses and customs checkpoints, which affected both retailers and consumers.

SCIENCE AND TECHNOLOGY

In 1996, Portugal had 18 scientific and technological learning societies, and 20 scientific and technological research institutes. The leading scientific academy is the Lisbon Academy of Sciences, founded in 1779. In 1996, Portugal had 27 universities and colleges offering courses in basic and applied sciences. Attached to the University of Lisbon is the Museum and Laboratory of Mineralogy and Geology, founded in 1837. In 1987–97, science and engineering students accounted for 36% of university enrollment. In 2000 (the latest year for which data was available) of all bachelor's degrees awarded, 17.5% were for the sciences (natural, mathematics and computers, engineering). Total government expenditures on research and development (R&D) in 2001 totaled $1.548.302 million, or 0.84% of GDP. Of that amount, 61% came from government sources, while the business sector accounted for 31.5%. In 2002, R&D spending amounted to $1,732.108 million, or 0.93% of GDP. In that same year, there were 1,842 scientists and engineers engaged in R&D per million people. High technology exports in 2002 totaled $1.628 billion, or 7% of the country's manufactured exports.

DOMESTIC TRADE

Lisbon and Porto are the two leading commercial and distribution centers. Larger retail stores, shopping malls, and supermarkets have become well-established in many areas. Franchising has also gained ground, particularly in the clothing and fast-food markets. Direct marketing through television and mail order sales has grown considerably. The most common advertising media are newspapers, outdoor billboards, radio, and television; movie theaters also carry advertisements.

The usual business hours are from 9 am to 6 pm, Monday through Friday. Banking hours are generally 8:30 am to 2:45 pm, Monday through Friday. An increasing number of shopping centers in urban areas have more flexible hours, including hours on Sundays.

FOREIGN TRADE

Portugal's foreign trade balance has regularly shown a heavy deficit, which it finances through net receipts from tourism, remittances from Portuguese workers abroad, and net transfers from the EU. In 2004, merchandise exports were an estimated $37.9 billion, and imports totaled $56.2 billion, which widened the trade deficit to $18.2 billion, up from $13.4 billion in 2003, as a result of stronger domestic demand.

In 2004, Portugal's exports consisted of capital goods (34.8% of total exports), consumer goods (32.4%), raw materials and intermediate products (30.2%), and energy products (2.6%). The major imports in 2004 consisted of capital goods (33.9% of all imports), raw materials and intermediate products (30.5%), consumer goods (24.6%), and energy products (11%). Portugal's leading markets in 2004 were Spain (24.9% of all exports), France (14%), Germany (13.5%), the United Kingdom (9.6%), the United States (6.1%), and Italy (4.3%). In all, 79.4% of all exports were traded with the 25 EU member nations. Portugal's leading suppliers in 2004 were Spain (29.3% of all imports), Germany (14.3%), France (9.3%), Italy (6.1%), the United Kingdom (4.6%), and the United States (2.4%). In total, 76.6% of all imports came from the 25 EU member nations. Portugal received 5% of its imports from OPEC nations.

BALANCE OF PAYMENTS

Despite chronic trade deficits, Portugal until 1973 managed to achieve a balance-of-payments surplus through tourist revenues and remittances from emigrant workers. With the economic dislocations of 1974, net tourist receipts fell 30%; the trade deficit almost doubled; and emigrant remittances stagnated—thus, the 1973 payments surplus of $255.7 million became a $647.7 million deficit in 1974. Emigrant remittances grew steadily between 1976 and 1980, when they peaked at $2,946 million. Because of this, Portugal's balance of payments improved and in 1979 even showed a surplus of $761 million. Subsequently, increasing trade deficits resulted in balance-of-payments deficits that reached $3.2 billion in 1982. By 1985, however, the deficit had become a surplus of $0.4 billion, which rose to $1.1 billion in 1986; the chief reason was the weakening dollar, which boosted the value of tourism earnings and remittances. The 1990 Portuguese external payments surplus stabilized at the previous year's record level of nearly $4 billion. After a few years of surplus boom, mainly due to the enormous

influx of foreign capital and transfers to Portugal following EC membership in 1986, measures were taken in July 1990 to restrict foreign credit and investment thereby helping the authorities get better control over monetary aggregates. These measures, along with the hiatus in international investment caused by the 1990–91 Persian Gulf crisis and some deterioration in the merchandise trade account contributed to halting the growth of the total nonmonetary balance.

The country's large current account deficit was 7.5% of GDP in 2002. Although foreign direct investment (FDI) in new manufacturing projects, such as the automotive and electronics sectors, increased in the 1990s, in the early 2000s FDI flowed to lower-cost manufacturing locations in central and eastern Europe, away from Portugal. In 2004, the current account deficit grew to $13.7 billion (8.1% of GDP), up from $8.4 billion in 2003. The current account deficit was expected to widen in 2005, reflecting deteriorating export competitiveness and slower external demand, but lower oil prices from the second half of 2006 were predicted to help narrow the deficit slightly in 2006–07.

BANKING AND SECURITIES

All 22 banks in Portugal, except for three foreign-owned ones (Banco do Brasil, Credit Franco-Portugais, and the Bank of London and South America), were nationalized in 1975. A 1983 law, however, permitted private enterprise to return to the banking industry. The Bank of Portugal, the central bank (founded in 1846), functions as a bank of issue, while the European Central Bank controls monetary policy.

During the late 1990s, Portugal's banking industry underwent significant restructuring due to foreign investment and consolidation. A major series of consolidations in 1996 left Banco Comercial Portugeuês (BCP), Banco Pinto and Sotto Mayor, and Banco Portugeuês de Investimento as the three largest private banks. Further consolidation came in 1999 when Spain's Banco Santander Central Hispano (BSCH) merged with Champalimaud. Fearing increased Spanish influence in the Portuguese banking industry, the Portuguese government sought to block the deal and the dispute appeared headed for the European Court. Ultimately, Portugal's finance minister, Joaquim Pina Moura, forged a compromise in which BSCH acquired two banks in the Champalimaud group.

The International Monetary Fund reports that in 2001, currency and demand deposits—an aggregate commonly known as M1—were equal to $47.0 billion. In that same year, M2—an aggregate equal to M1 plus savings deposits, small time deposits, and money market mutual funds—was $111.7 billion.

Portugal's two stock exchanges, located in Lisbon and Porto, were closed after the coup of April 1974. The Lisbon exchange reopened in 1976, and the Porto exchange in 1981. In January 1992 the market was split into three tiers, of which the first is the major liquid market: this included the 11 firms whose shares are traded regularly and which have a minimum market capitalization of e500 million. Trading outside the stock exchanges is still widespread. Into the late 1990s trade on the exchange continued to grow as continued privatization led to greater amounts of Initial Public Offerings (IPOs). As of 2004, there were 56 companies listed on the EURONEXT Portugal exchange, which had a market capitalization of $73.404 billion. In 2004, the PSI 20 Index rose 12.6% from the previous year to 7,600.2.

INSURANCE

Portugal's domestic insurance companies were nationalized in 1975. Foreign companies were required to accept government representatives among their directors. A new law, approved in 1983, allowed the private sector to reenter the domestic insurance industry. Almost all Portuguese companies sell life and nonlife insurance, although some specialize in reinsurance only. In the wake of the reprivatization of the insurance industry, many insurance companies have sought alliances with banks. This position, in turn, serves as an impediment to new entrants into the insurance field, particularly from foreign countries. However, the market is opening up and brokers from any European Union (EU) country can operate in Portugal. Third-party auto insurance and workers' compensation are compulsory in Portugal. Contractors, travel agents, insurance brokers and other professionals are also required to carry liability insurance. In 2003, the value of direct insurance premiums written totaled $10.810 billion, of which life insurance premiums accounted for $6.122 billion. In that same year, Portugal's top nonlife insurer was Fidelidade-Mundial, which had gross written nonlife premiums of $998.9 million. The country's leading life insurer, Occidental Vida, that year, had gross written life insurance premiums of $1,039.9 million.

PUBLIC FINANCE

Portugal's budgets (accounting for the effects of loans and transfers) have been in deficit since 1974. Major factors contributing to the deficits included spending on health and education programs, funding for major public investment projects, and large state-owned enterprise payrolls. To finance the deficit, the government issued bonds in the domestic market, which also serves the monetary policy purpose of absorbing excess liquidity. The government's objective to join the Economic and Monetary Union (EMU) was achieved in 1999. Since then, monetary policy responsibilities have been absorbed by the European Central Bank. Public debt exceeded 3% of GDP in 2001, exceeding EU limits and

opening the country up to sanctions from the rest of the EU. By 2004 it continued to hover around 3%, but was expected to top 6% in 2005. In 2005 the EU ordered the country to reduce deficits, which the government planned to do by raising the value-added tax and cutting spending.

The US Central Intelligence Agency (CIA) estimated that in 2005 Portugal's central government took in revenues of approximately $78.8 billion and had expenditures of $90.2 billion. Revenues minus expenditures totaled approximately -$11.4 billion. Public debt in 2005 amounted to 69.4% of GDP. Total external debt was $298.7 billion.

TAXATION

The national corporate tax rate in Portugal as of 2005 was 25%, although rates in Madeira were 22.5% and 17.5% in the Azores. In addition, municipalities can levy a 10% surtax on the tax liability, pushing the effective rate to 27.5%. Allowable deductions in calculating taxable corporate income include depreciation, interest payments, executives' salaries, and royalties. Capital gains are taxed at 25%. Dividends paid to parent companies by subsidiaries (owned at least 25% by the payee) are excluded from taxable income to avoid double taxation. Otherwise dividends are taxed at general income tax rates.

The progressive personal income tax schedule has six bands, not including a tax-exempt base. The schedule bands as of 2003 were 15% (up to €4,100); 14% (on the next increment of income to €6.201); 24% (on the next increment to €15,375); 34% (on the next increment to €35,363): 38% (on the next increment to €51,251); and 40% (on the increment of income above €15,375). Social security taxes amount to 23.75% of nominal income. There are also taxes municipal taxes on the value of real estate.

The main indirect tax is Portugal's value-added tax (VAT) introduced 1 January 1986 with a standard rate of 16%, which was raised to 17% as of 1 January 1995 and to 19% as of 6 May 2002. There is also a reduced rate of 5% (applied to basic foodstuffs, water supplies, books, newspapers and periodicals, social housing, some medical equipment and drugs, hotel accommodations, repair and domestic services); an intermediate "parking" rate of 12% (applied to some foodstuffs, catering, and some fuels and lubricants); and exemptions from VAT (for social services, some medical and dental services, waste collection and disposal, transportation services, gold transfers to the central bank, and cremation.). For the Azores and Madeira, the standard VAT rate is 13%, the reduced rate 4% and the parking rate 8%. Other transactions taxes include stamp duties and transfer fees.

CUSTOMS AND DUTIES

Portugal uses the Harmonized Nomenclature and Classification System (HS) to organize imports into tariff categories. Almost all tariffs are levied on an ad valorem basis according to the EU Customs Code, excepting luxury goods and petroleum, which have special higher rates. Portugal adheres to all EU trade policies, including multilateral trade agreements, and conforms to WTO regulations. It also levies a value-added tax (VAT) of up to 21% on most imports, although there is a lower rate of 5%. In Madeira and the Azores, the lower rates of 4% and 13% apply. The VAT on imports from EU countries is not collected until the product is sold.

FOREIGN INVESTMENT

The government actively promotes foreign investment as an integral part of its economic development policy, and specifically through a government agency, API (Agency for Investment in Portugal). As a member of the European Union, Portugal abides by the investment rules that govern the rest of the union. New foreign investment legislation was enacted in 1986. The Institute of Foreign Investment (ICEP) is the supervising agency. Foreign investment is permitted in all sectors except ports, water management, rail services, public service telecommunications operators, and the arms industry. Portugal restricts non-EU investment in regular air transport to 49%, and restricts non-EU investment in television operations to 15%. Even in these areas, however, deregulation is under way. The foreign investment code contains liberal profit remittance regulations and tax incentives. The rate of corporation tax was reduced from 30% to 25% in 2004 as part of that year's budget, but rates in most municipalities are higher by some three percentage points due to the effects of local surcharges.

Foreign direct investment (FDI) inflows in Portugal averaged about $2 billion per year in 1992–95, or 1.6% of GDP. Main investing countries are the United Kingdom, Spain, and France. The financial sector accounted for about 60% of all new foreign investment. In 1998, FDI inflows reached $3.1 billion, up from $2.5 billion in 1997, but fell to $1.2 billion in 1999. FDI inflows soared to $6.4 billion in 2000, and were still above $6 billion in 2001, despite the global economic slowdown.

Total FDI inflows into Portugal in 2003 were €852.2 million. Portuguese FDI abroad was in the negative numbers, at -€84.6 million. Portugal invests most heavily in Brazil and Spain, followed by Germany and other EU countries. Low labor costs, combined with unrestricted access to the EU market, have attracted foreign investment in new manufacturing projects, especially in the automotive and electronics sectors. However, FDI has slowed as low-cost manufacturing locations in central and Eastern Europe have become increasingly appealing to investors, especially since the admission of 10 new EU members in 2004. Therefore, Portugal can no longer afford to rely solely upon low wage costs to attract further investment.

ECONOMIC DEVELOPMENT

In 1975, radical economic transformations were accomplished through a series of decrees that nationalized the domestically owned parts of major sectors of the national economy. These decrees affected the leading banks, insurance companies (representing 99% of insurance companies' capital), petroleum refineries, the transportation sector, the steel industry, and eventually Portugal's leading privately owned industrial monopoly, Companhia União Fabril. At the same time, large-scale agrarian reform measures led to expropriation of many of the country's privately owned large landholdings; other holdings were seized illegally by peasants. In an attempt to stimulate agricultural production, the government decreed a 30% reduction in the price of fertilizer to farm workers and small and medium farmers. When the nationalization and agrarian reform measures met with only limited success, partly because of liquidity problems, an emergency austerity plan was approved by the Council of Ministers in October 1975. The program included wage and import controls and the reduction of subsidies on consumer goods.

As a result of Portugal's entry into the EC (now EU), the highly protected, unresponsive, and inefficient economy is being transformed. State intervention is being reduced, and the physical infrastructure is being modernized. Privatization began in 1989, with the share of gross domestic product (GDP) for non-financial public enterprises reduced from 17.9% in 1985 to 10.7% in 1991. In 1992, $3.6 billion was raised as banks, insurance companies, and a 25% interest in Petrogal—the state oil company—were sold. The government estimated that privatized companies would represent half of stock market capitalization by the end of 1994.

In 1996 and 1997, a series of important investments and acquisitions were made by companies such as Sonae and Jernimo Martins, Portugal's leading retail distributors; Cimpor, a cement producer; and Portugal Telecom and Electricidade de Portugal, the last of which was privatized. The big banks were developing new overseas operations as well. The best indicator of Portugal's economic progress was Portugal's acceptance into the European Economic and Monetary Union in 1999.

During the 1990s and into the 2000s, the economy grew at rates well above EU averages; however, growth slowed in 2002–03, and fell below the euro-area average for the first time in close to a decade. In 2002, the external current account deficit remained one of the largest (in relation to GDP) among industrialized countries. The unemployment rate also increased sharply. Nonetheless, an inflow of capital funds has financed infrastructure projects.

In 2001, Portugal became the first country to breach the eurozone's Stability and Growth pact budget deficit target of 3%, with a gap equal to 4.2% of GDP. Portugal's government met the 3% target in 2002 and 2003, but despite a hiring freeze and other measures, the country had a structural budget deficit in 2004 projected at 4.9%. Public spending was expected to equal 47.9% of GDP in 2004. The 2005 budget projected a structural deficit in excess of 3%, and violated the 60% limit on public debt. Due to labor reform legislation, which took effect in early 2004, and corporate and personal tax cuts in 2004 and 2005, the government expected the economy to recover strongly in 2006.

The government is attempting to change Portugal's economic development model from one based on public consumption and public investment to one focused on exports and private investment.

SOCIAL DEVELOPMENT

A social insurance and social assistance program has been frequently updated since 1935. The program provides old-age, disability, sickness, and unemployment benefits, family allowances, and health and medical care. The system is funded by payroll contributions from employers and employees. The government subsidizes social pensions for those persons not employed. Retirement is set at age 50 for miners, age 55 for fishermen and seamen, and age 65 for other professions. Medical benefits are provided to all residents, and cash sickness and maternity benefits are provided to employees. Maternity benefits of 100% of earnings and benefits are paid for 120 days for all employed persons. Paternity and adoption benefits are also available. There is a need based family allowance, a special education allowance, and a funeral grant.

Women have full rights and protections under both the constitution and civil code. According to law, women must receive equal pay for equal work. In practice, however, a salary gap still exists between men and women. Spousal abuse and other violence against women are widespread problems and remain underreported. The judicial system is supportive when cases are brought forward. Sexual harassment in the workplace is considered a crime, but only if committed by a superior.

Immigrants from Portugal's former African colonies face social prejudice and discrimination. There were reports of right-wing groups carrying out racially motivated attacks against immigrants and other nonethnic Portuguese. Human rights are generally respected in Portugal. Prison conditions are poor, but the government is engaging in dialogue with human rights organizations on this and other issues.

HEALTH

The public health care sector is by far the largest. The country planned to construct 12 new hospital districts, 84 health centers, and 5 technical schools for nurses, and to enlarge or remodel several hospital centers, hospital districts, and maternity wards. The Santa Maria Hospital in Lisbon is the largest hospital in Portugal. The number of physicians in Portugal grew steadily throughout the 1990s. As of 2004, there were an estimated 324 physicians, 374 nurses, 44 dentists, and 84 pharmacists per 100,000 people. Total health care expenditure was estimated at 7.7% of GDP.

As of 2002, the crude birth rate and overall mortality rate were estimated at, respectively, 11.5 and 10.2 per 1,000 people. Approximately 66% of married women (ages 15 to 49) were using contraception. The infant mortality rate decreased from 61 to 5.05 per 1,000 live births between 1968 and 2005. Average life expectancy in 2005 was 77.53 years.

The leading natural causes of death are circulatory disorders, cancer, and respiratory disorders. Children up to one year of age were vaccinated against diphtheria, pertussis, and tetanus, 95%, and measles, 99%. The cancer and heart disease rates in Portugal are well below the industrialized countries average.

The HIV/AIDS prevalence was 0.40 per 100 adults in 2003. As of 2004, there were approximately 22,000 people living with HIV/AIDS in the country. There were an estimated 1,000 deaths from AIDS in 2003.

HOUSING

According to the 2001 census, Portugal had about 5,054,922 dwelling units. However, about 65% of all families live in dilapidated structures and nearly 8.5% live in shacks. While the Government Social Housing Program has made some progress in rehousing families into more adequate structures, there are not enough programs to help the households rise above the poverty level. Traditional Portuguese houses are made of brick walls and tile roofs.

EDUCATION

Basic education is compulsory for nine years. This includes three cycles of four, two, and three years each. Secondary level education covers a three-year program; students choose between general secondary, professional, and specialized technical or vocational schools. The academic year runs from September to July.

In 2001, about 70% of children between the ages of three and five were enrolled in some type of preschool program. Primary school enrollment in 2003 was estimated at about 100% of age-eligible students. The same year, secondary school enrollment was about 85% of age-eligible students. It is estimated that about 98% of all students complete their primary education. The student-to-teacher ratio for primary school was at about 13:1 in 2003; the ratio for secondary school was about 8:1. In 2003, private schools accounted for about 10.5% of primary school enrollment and 14.7% of secondary enrollment.

Coimbra University, founded in 1290, is Portugal's oldest institution of higher learning, and the universities of Lisbon and Porto are two of the largest. There are also art schools, music schools, and a school of tropical medicine. The Portuguese Catholic University was instituted by decree of the Holy See. In 2003, about 56% of the tertiary age population were enrolled in some type of higher education program; 48% for men and 64% for women. The adult literacy rate for 2003 was estimated at about 93.3%.

As of 2003, public expenditure on education was estimated at 5.8% of GDP, or 12.7% of total government expenditures.

LIBRARIES AND MUSEUMS

The leading libraries of Portugal are the National Library, founded in 1796 (about 2.3 million volumes) and the Library of the Academy of Sciences (400,000) in Lisbon, the University Library in Coimbra (one million), and the Municipal Library in Porto (1.27 million). The Public Libraries Programme in Portugal was launched in 1987 with a goal of providing public library services in each of the country's 275 municipalities. By 1999, about 166 libraries had been established.

There are some 300 museums in Portugal. Most feature exhibits relating to Portuguese history. Lisbon has the National Museum of Ancient Art, the Museum of Decorative Arts, the Calouste Gulbenkian Museum, and the Center for Modern Art, as well as the National Museum of Natural History. The Abbey of the Friars of St. Jerome in Belém and the Battle Abbey in Batalha contain some of the finest examples of Portuguese art. There are dozens of municipal ethnographic and historic museums, as well as many finely restored castles and manors.

MEDIA

Direct radiotelephone service connects Portugal with its former and current overseas provinces in Africa and Asia. In 2003, there were an estimated 411 mainline telephones for every 1,000 people. The same year, there were approximately 898 mobile phones in use for every 1,000 people.

The government broadcasting network, Radiodifusão Portuguesa, and Radio Renascenca, a religious network, operate AM and FM stations. The state-owned television network, Radiotelevisão Portuguesa, offers color broadcasts on two channels. In 2005, there were an additional 300 local and regional commercial radio stations and at least two other commercial television stations. In 2003, there were an estimated 299 radios and 413 television sets for every 1,000 people. About 128.2 of every 1,000 people were cable subscribers. Also in 2003, there were 134.4 personal computers for every 1,000 people and 194 of every 1,000 people had access to the Internet. There were 458 secure Internet servers in the country in 2004.

The constitution of 1976 guaranteed freedom of the press. The principal daily newspapers (with their affiliation estimated 2002 circulations) include: Correo da Manha (independent, 85,000), Diario de Noticias (Communist, 75,560), Publico (75,000), Diario Popular (leftist, 62,000), A Capital (leftist, 40,000), Jornal de Noticias (leftist, 90,000), Comercio do Porto (moderate, 30,300), and Oprimeiro de Janeiro (conservative, 20,200). The weekly paper Expresso has a circulation of 160,000.

ORGANIZATIONS

The principal current organizations are syndicates, the majority of which are linked to the national trade union confederation; residents' commissions; workers' commissions; and popular assemblies. Many of these associations, particularly in rural areas, are involved in local community improvement projects as well as political and cultural activities. There are four chambers of commerce and three main industrial organizations, the oldest of which, the Industrial Association of Porto, dates from 1849.

The Academy of Sciences Lisbon is primarily a scholarly and research organization. Several professional associations also promote research and public education in a variety of fields, particularly in medicine and healthcare. There are organizations for hobbyists, including the multinational Federation of European Philatelic Associations.

National youth organizations include Association of Young Farmers of Portugal, Communist Youth of Portugal, International Friendship League of Portugal, Monarchist Youth of Portugal, the Scout Federation of Portugal, and YMCA/YWCA. There are several sports associations in the country, representing a variety of pastimes such as tae kwon do, badminton, tennis, and track and field. There is a national chapter of the Special Olympics.

The Kiwanis and Lion's Clubs also have active programs. Amnesty International, Habitat for Humanity, and the Red Cross have national chapters.

TOURISM, TRAVEL, AND RECREATION

Portugal's historic cities—Lisbon, Porto, Coimbra, and others—offer numerous museums, old churches, and castles. Most villages still celebrate market days with dances and other festivities. There are more than 800 km (500 mi) of beaches. The Portuguese bullfight (differing from the Spanish variety in that the bulls are not killed) is a popular spectator sport; the season lasts from Easter Sunday to October. Football (soccer) is popular as both a participant and a spectator sport. A valid passport is required; visas are needed for stays of more than 90 days.

Tourism has become a major contributor of foreign exchange earnings and a stimulus to employment and investment in the hotel industry and related services. The number of tourists was 11,644,231 in 2002. Hotel rooms numbered 105,986 in 2003 with 238,759 beds and an occupancy rate of 38%.

The daily cost of staying in Lisbon, according to 2005 US Department of State estimates, was $232. Other areas were between $159 and $255, with some rates varying by season.

FAMOUS PORTUGUESE

During Portugal's golden age, the 15th and 16th centuries, the small Portuguese nation built an overseas empire that stretched halfway around the globe. Prince Henry the Navigator (Henrique Navegador, 1394–1460) laid the foundations of the empire. Among the leaders in overseas exploration were Bartholomeu Dias (1450?–1500), the first European to round the Cape of Good Hope; Vasco da Gama (1469–1524), who reached India and founded Portuguese India in 1498; and Pedro Alvares Cabral (1460?–1526), who took possession of Brazil for Portugal in 1500. Ferdinand Magellan (Fernão de Magalhães, 1480?–1521) led a Spanish expedition, the survivors of which were the first to sail around the world, although Magellan himself was killed after reaching the Philippines. Afonso de Albuquerque (1453–1515) was foremost among the builders of Portugal's Far Eastern empire.

Famous literary figures of the golden age include the historians Diogo do Couto (1542–1616) and João de Barros (1496–1570); Portugal's greatest writer, Luis Vas de Camões (1524?–80), the author of Os Lusiadas, the Portuguese national epic, and of lyric and dramatic poetry; the dramatists Gil Vicente (1465?–1537?) and Francisco de Sá de Miranda (1482–1558); the poets Bernardim Ribeiro (1482?–1552) and Diogo Bernardes (1532?–96?); and the travel writer Fernão Mendes Pinto (1509–83). Portugal's leading painter was Nuno Gonçalves (fl.1450–80).

Among the noted Portuguese of more recent times are Sebastião José de Carvalho e Mello, marquis de Pombal (1699–1782), the celebrated prime minister of King Joseph Emanuel (José Manuel, 1715–77); the novelists Camilo Castelo Branco, viscount of Correia-Botelho (1825–90), and José Maria Eça de Queiróz (1843–1900); the poets João Baptista da Silva Leitão, viscount of Almeida-Garrett (1799–1854), Antero Tarquinio de Quental (1842–91), João de Deus Nogueira Ramos (1830–96), Teófilo Braga (1843–1924), and Abilio Manuel Guerra Junqueiro (1850–1923); the satirist José Duarte Ramalho Ortigão (1836–1915); and the painter Domingos António de Sequeira (1768–1837). António Caetano de Abreu Freire Egas Moniz (1874–1955) won the Nobel Prize in physiology in 1949.

António de Oliveira Salazar (1889–1970), prime minister for more than 30 years, was Portugal's best-known modern leader. Gen. (later Marshal) António Sebastião Ribeiro de Spínola (1910–96) played a key role in the revolution of April 1974. Gen. António dos Santos Ramalho Eanes (b.1935) became president in 1976 and was reelected in 1980. Other political leaders include: Mário Alberto Nobre Lopes Soares (b.1924), Francisco Sá Carneiro (1934–80), Jorge Fernando Branco de Sampaio (b.1939), Aníbal António Cavaco Silva (b.1939), António Manuel de Oliveira Guterres (b.1949)—a former prime minister who became the United Nations High Commissioner for Refugees, and José Manuel Durão Barroso (b.1956)—a former prime minister who became president of the European Commission.

DEPENDENCIES

Between 1974 and 1976, all of Portugal's overseas possessions in Africa—including Angola, the Cape Verde Islands, Portuguese Guinea (now Guinea-Bissau), Mozambique, and São Tomé and Príncipe—became independent countries in accordance with the Armed Forces Movement's decolonization policy. After the Portuguese withdrew from East Timor, in the Indonesian archipelago, the former colony was invaded by Indonesian forces in 1975 and became a province of Indonesia in 1976; East Timor became an independent nation in 2002. Macau, on the south coast of China, was a "Chinese territory under Portuguese administration" from 1975–99.

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