Country profile - Societal developments (Portugal)

In the fifteenth century, Portugal was a country of sailors, mapmakers, astronomers, shipbuilders and instrument makers who were interested in discovering new lands. Portugal was known for its explorers, who were the first Europeans to sail to Africa, the distant Orient and the heart of South America. The discovery of new territories led to the accumulation of an overseas empire which stretched from Africa to America and Asia.

In the nineteenth century, Portugal lost Brazil, its largest territorial possession abroad, which resulted in a period of disruption to its political stability and potential economic growth. After the Portuguese Colonial War and the Carnation Revolution coup d'état in 1974, the ruling regime was deposed in Lisbon and the country handed over its last overseas provinces in Africa. Portugal's last overseas territory, Macau, was handed over to China in 1999.

Over the last 40 years, Portugal has been transformed from a colonial country with territories across the world to a European country of medium dimension. On the other hand, thanks to its island territories, the Portuguese Exclusive Economic Zone (EEZ) covers an area of almost 1.8 million km².

Portugal has been a member of the United Nations since 1955 and is a founder member of the Latin Union, the Organization of Ibero-American States, the Organisation for Economic Co-operation and Development (OECD), the North Atlantic Treaty Organization (NATO) and the Community of Portuguese Language Countries.

Portugal has been a member of the European Union since 1986 and since joining it has become a diversified and increasingly service-based economy. There has been a considerable improvement in GDP – from EUR 8 400/inhabitant in 1988 to EUR 12 400/inhabitant in 2008. During the same period, the inflation rate decreased from 11.7 % to 2.6 %.

Tourism is one of Portugal’s main activities and accounts for roughly 10 % of GDP[1].

In social and economic terms there has also been improvement, with a decrease in infant mortality from 13 % in 1988 to 3.3 % in 2008. Moreover, between 1988 and 2006-2008, life expectancy increased from 70.7 to 75.49 years (for men) and from 77.6 to 81.74 years for women.

Over the past two decades, successive governments have privatised many state-controlled firms and liberalised key areas of the economy, including the financial and telecommunication sectors.

In 2002, Portugal entered the Economic and Monetary Union together with 12 other Member States, having adopted the Euro as its official currency.

For much of the 1990s, economic growth was above the EU average, but then decreased during the period 2001-2008. GDP per capita is roughly two-thirds of the EU-27 average. As stated in the OECD report[2], progress towards convergence with average OECD living standards has suffered a reversal since 2000, due in particular to weak labour productivity growth. Recent reforms have included some easing of employment protection legislation and improvements in upper-secondary education. Other key areas which need further reform include the improvement of standards in secondary education, the reduction of the administrative burden on businesses and the reform of employment protection legislation.