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Portugal REVOLUTIONARY CHANGE
The military coup of April 1974, which ousted the
long-lived
authoritarian Salazar-Caetano regime, was rapidly
transformed
into a social revolution that profoundly recast Portugal's
political and economic systems
(see
Spínola and Revolution, ch.
4). The revolutionary leadership undercut the old elite's
economic base by nationalizing the banks and most of the
country's heavy and medium-sized industries; expropriating
landed
estates in the central and southern regions; and giving
independence to Angola, Mozambique, and other colonies.
The last
action dismantled the web of economic relationships, known
as the
Escudo Area, through which metropolitan Portugal was
linked to
its "overseas provinces."
In the brief period between the collapse of the old
regime in
April 1974 and the abortive leftist coup of November 1975,
a
variety of economic models were proposed for Portugal by
the
provisional Armed Forces Movement (Movimento das Forças
Armadas--
MFA) governments, including the West European, Yugoslav,
and
Albanian models. In the early months following the
military coup,
the new Portuguese government's economic orientation could
be
described as moderate-reformist. The regime's Economic and
Social
Program published on May 15, 1974, made no provision for
largescale nationalization of industry or agriculture. The
program
simply provided for the "adoption of new measures of
government
intervention in the basic sectors of the economy and
particularly
in the sectors of national interest, without prejudice to
the
legitimate interest of private enterprise"; argued for
"reform of
the tax system so as to rationalize it and ease the tax
burden on
less well-off groups, with a view of a fairer distribution
of
income"; recommended measures "to stimulate agriculture
and
gradual reform of the land tenure system"; and, within the
sphere
of social policy, favored introduction of "a minimum wage
to be
progressively extended to all sectors of activity."
The initial moderate-reformist policies reflected the
views
of General António de Spínola, who was chosen by the MFA
to lead
the coup and to serve as the country's president. Spínola,
the
celebrated war hero, favored the establishment of civil
liberties
and the creation of democratic institutions. He also
advocated
rapid improvement of living standards, a modernized
financial
structure, and eventual Portuguese participation in the
EC--objectives laid down in an economic plan he
commissioned from
Erik Lundberg of the World Bank. Spínola's view on the
economy
and the pace of decolonization diverged from those of the
Coordinating Committee of the MFA, most of whose members
were
prepared to end completely the Portuguese presence in
Africa and
to expand substantially the scope of the public sector. By
the
early autumn of 1974, events both within and outside
Portugal
favored the course chosen by the MFA coordinating
committee.
Unable to stop the leftward drift of the country, Spínola
resigned in September 1974.
Data as of January 1993
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