The Methuen Treaty …

Years: 1703 - 1703

The Methuen Treaty (1703): Portugal’s Perpetual Dependence on English Textiles

The Methuen Treaty, signed in 1703 between Portugal and England during the War of the Spanish Succession (1701–1714), was an offensive military and commercial alliance that had long-term economic consequences for Portugal. Under this treaty, Portugal agreed to import exclusively English-manufactured textiles “in perpetuity”, while England granted preferential duties on Portuguese wine exports.


The Military and Economic Context of the Methuen Treaty

  • Portugal, initially allied with France, switched sides in 1703, joining England and the Grand Alliance against Bourbon Spain.
  • England needed Portugal’s ports (Lisbon and Oporto) as strategic naval bases for military operations against France and Spain.
  • Portugal, in return, sought economic and military support from England.
  • The treaty, negotiated by John Methuen (English envoy) and Manuel Teles da Silva, 1st Marquis of Alegrete (Portuguese representative), tied Portugal’s economy to England’s industrial and commercial dominance.

Key Terms of the Methuen Treaty (1703)

  1. Exclusive Importation of English Textiles

    • Portugal obligated itself “in perpetuity” to import only English-manufactured textiles, eliminating domestic competition.
    • This stifled Portugal’s own textile industry, preventing industrial development.
  2. Preferential Tariffs for Portuguese Wine in England

    • In exchange, English consumers enjoyed lower duties on Portuguese wines (particularly Port wine).
    • This significantly boosted Portuguese wine exports to England.
  3. Military Alliance Against Spain and France

    • Portugal agreed to support England militarily during the War of the Spanish Succession.

Consequences of the Methuen Treaty

 Portugal’s Wine Industry Thrived

  • The treaty increased Portuguese wine exports, making England its largest customer.
  • It secured a stable demand for Port wine, shaping Portugal’s economy for centuries.

 Portugal’s Industry Declined

  • Portugal became dependent on English-manufactured goods, particularly textiles, stifling domestic industrialization.
  • Portuguese wealth, especially gold from Brazil, was used to pay for English imports, enriching England at Portugal’s expense.

 Long-Term Economic Dependence on Britain

  • The treaty cemented Portugal’s economic reliance on England, leading to a trade imbalance that persisted into the 19th century.

Conclusion: A Short-Term Gain, A Long-Term Disadvantage

While the Methuen Treaty (1703) secured an English military alliance and boosted Portuguese wine exports, it also permanently weakened Portugal’s textile industry. The treaty benefited England far more than Portugal, reinforcing Portugal’s economic dependence on British trade policies, a situation that persisted for over a century.

 

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