WI: Salazar Doesn't Fall

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Salazar and Caetano were many things, but the country was certainly not bankrupt in 1974. They both were miserly with funds, and Portugal had a positive balance of payments situation throughout the wars, as did the colonies. In terms of gold reserves, Portugal had 866 tonnes of gold amassed by 1974. In addition, 1974 was the first year where the royalty payments of oil in Angola covered the entire defence budget.

Though Portugal had usually imported more than it exported, the large-scale emigration led to a positive balance of payments situation by 1974 due to the huge amounts of remittances sent home by emigrants. Additionally, like Spain, Portugal began to invest in attracting tourists, with new airports in Faro and Funchal, by 1973, 4 million foreign tourists visited Metropolitan Portugal.

GDP grew 120% between 1961 and 1973, as the economy changed from an agricultural one to a manufacturing and service-based economy. Per capita GDP grew by 6.9% per year between 1960 and 1973, making it one of the highest rates of growth in the world. By 1973, industry accounted for 44% of the GDP, services for 39% and agriculture 17%. Merchandise exports grew by 11% per year between 1959 and 1973, with manufactured goods becoming increasingly important. By 1973, Portugal's per capita GDP was 56.4% of the EC-12 average. This was compared with 38% in 1960. Between 1974-1983 Portugal's economy performed poorly and Portugal actually diverged, with per capita GDP being 55% of the EC-12 average in 1991.

Portugal was still very underdeveloped compared to other Western European countries and the Colonial War, especially in Guinea-Bissau, was a huge drain on money.
 
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