Portugal was founded in 1128 by its first king D. Afonso Henriques. Despite being a relatively small country, it has played a crucial role in world history. Its borders have remained the same longer than any other European country's, and it maintains the longest existing alliance in the world (since 1386) with the United Kingdom, known as the "Treaty of Windsor". So in otherwise neutral Portugal, this alliance was invoked during World War II, allowing the British to establish a military base in the Azores which was later on, under NATO agreements, transferred for use by the USA during the Cold War. British troops headed to the Falklands War used it as a staging point.
In the mid-15th century, Prince Henry, the Navigator, from his Escola de Sagres promoted and sponsored the maritime exploration of the Atlantic Ocean, finding the archipelagos of Madeira, Azores, reaching Greenland and later on leading to the naming of Terra Nova (Newfoundland), Lavrador (Labrador) and the founding of colonial enterprises on the west coast of Africa. After his death, successors continued to voyage further and further throughout the 15th and 16th centuries, enabling Portugal to begin a major chapter in world history with the New World Discoveries (Descobrimentos) and monopoly over trade between the Orient and Western Europe.
Portugal established the Cape Route to India, and colonised the Madeira and Azores archipelagos. To consolidate imperial supremacy, Portugal established a chain of fortified military towns and trading outposts that eventually linked in Africa (Ceuta, Canary Islands, Ivory Coast, Cape Verde, Guinea Bissau, São Tomé e Príncipe, Zaire, Angola, Cape of Good Hope, Natal, Mozambique, Zanzibar, Mombasa etc.), South America (Brazil, Caribbean, parts of Argentina and Uruguay), Asia (Hormuz, Goa, Bombay, Macau, Ceylon, Malacca, Phuket), and Oceania (Sumatra, East Timor, Flores, Moluccas, Papua New Guinea, etc), creating an empire covering most of the Atlantic Ocean, the Indian Ocean and parts of the South China Sea and Southwest Oceania. Additionally, after reaching Japan in the mid-16th century, Portuguese sailors explored vast areas of the Pacific Ocean resulting in 1571, the Japanese port city of Nagasaki being established by the Portuguese and local lords, to handle the new trade demand. The Portuguese language continues to be a shared heritage of most of these countries, while Roman Catholicism remains the dominant religion throughout much of the former Portuguese Empire.
During the second half of the 16th century, the Portuguese Crown entered a succession crisis with the loss of the young heirless king, Dom Sebastião, at the battle of "Alcacér-Quibir". As a result of the crisis, the Portuguese nobility keen to avoid a civil war, reluctantly agreed to unify Portugal with Spain under the crown of King Phillip II, thus creating the period of "Iberian Union" which lasted from 1580 to 1640. During the union period, the Portuguese Empire interests were negatively affected, because of the rivalry between Spain and England, as well as Madrid's disinterest in Portugal's overseas matters. Furthermore, much of Portugal's overseas maritime/naval capacity and resources were disrupted by the commissioning and redirection of its vessels towards the Great Armada preparations for the invasion of Britain, which had disastrous consequences for Spain and Portugal. By then, as a result of the belligerence, the Treaty of Windsor had been suspended, while at the same time the Netherlands seized the opportunity to gain footholds in Portuguese Empire territories of South America, Africa and Asia.
Portugal regained its independence from Spain in 1640, and to re-enforce its world position, the wedding of the British King Charles II to Princess Catherine of Bragança was celebrated. However, despite Portugal regaining most of the territories previously lost to the Netherlands, this royal wedding marked the beginning of a slow decline in Portugal's scientific eminence and domination of world affairs. The expulsion of the remaining unconverted Jewish community also played an important role in this decline. Nevertheless, at the end of the 17th century, a period of stabilisation followed and gained momentum during the early 18th century, after the discovery of large deposits of gold and diamonds in Brazil. As a result of the new wealth flowing into the national treasury, the Portuguese Crown was able to finance many major projects to develop and modernise the country and some overseas possessions.
Amidst this new period of rejuvenation, on 1 Nov 1755, the Great Lisbon Earthquake and subsequent tsunami devastated the Portuguese Empire's capital. The effects were such that victims were recorded as far afield as Morocco. Of the estimated more than 200,000 Lisbon inhabitants, at least some 40,000 perished. Between the initial quake (estimated to be of around 8.5 degrees) and subsequent aftershocks, flooding and fires, about 60% of all buildings and structures were lost together with art, archives, libraries, factories, businesses, etc. The national GDP dropped an estimated 40%, marking the start of another national crisis compounded by the expelling of the Jesuit and other religious orders and with it many academics and scientists of the day.
At the beginning of the 19th century, as a result of France's European wars and expansion conflicting with the British Empire and their allies, the country was invaded by Napoleon's army, throwing the Portuguese monarchy and rest of the country into chaos at all social and economic levels. The Royal Family and most of the nobility left Lisbon and settled in Rio de Janeiro, in self-imposed exile. Even after the Peninsular War ended in defeat for the French, the country nevertheless failed to recover and went from crisis to crisis almost continually until the beginning of the 20th century, with the loss of Brazil in 1822 and the scramble for Africa in the 1880s severely curtailing the Portuguese Empire's size and power.
In 1910, the republican movement overthrew the monarchy and established a republic. However, the new republic continued to lurch from crisis to crisis, reaching a near collapse by the mid 1920s. At this time, the military intervened and asked Professor António de Oliveira Salazar, a well-reputed economist from Coimbra University, to take control of the nation's economy and help stabilizing the country. By the early 1930s, Portugal had stabilised and Salazar's role was reinforced by the establishment of a corporatist authoritarian one-party state which prioritised balancing the books over social needs.
Although Portugal registered phenomenal economic growth from the 1950s onwards, the Fascist regime or Estado Novo (New State) gradually became unpopular due to its undemocratic handling of government affairs. In response, the New State implemented a regime of repression against any opposition which resulted in independence movements appearing in Portugal's overseas colonies, culminating in a prolonged colonial war. Coupled with a growing discontent within its own continental metropolitan population, the regime's authority was further undermined. The country's prestige suffered severe setbacks at the UN due to the regime's stubbornness in not allowing democracy to gain inroads, and armament embargoes were imposed. Amnesty International was created in the early 1960s as a result of the police arresting several dissenting students from Coimbra University.
Salazar was replaced by Marcello Caetano after suffering a stroke in 1968, and died in 1970. On April 25, 1974, a left-leaning coup d'état organised mostly by junior army officers arrived in Lisbon and overthrew Caetano and the Estado Novo regime with popular support. After a turbulent brief period ruled by a military junta, an attempted right-wing putsch took place but was quickly followed by a pro-democracy counter-putsch with Portugal finally transitioning to democracy.
During that period, the overseas colonial wars in Guinea-Bissau, Angola, Mozambique and East Timor came to a sudden end, culminating in the independence of all Portuguese African possessions, while East Timor in Asia was annexed by Indonesia (the Azores and Madeira were never "colonies" and remain part of Portugal, albeit as autonomous regions). However, as a result of poor and uncoordinated political and economical leadership in the post-revolutionary period, the country quickly stagnated again. After the wave of state nationalisations came to an end and more liberal and balanced economic policies began to be implemented in the late 1970s, Portugal gradually began to get used to a more democratic way of life and prosper.
The decision to join the European Economic Community, now the European Union, enabled the country to approach Western European standards of development after 1986. Portugal's last colony, Macau, was returned to China in 1999, thus bringing the Portuguese colonial empire to an end. Portugal was severely hit by the European sovereign debt crises of 2007-2008, but has since restructured its economy and recovered, with tourism being the main driver behind the current economic boom.
