1942: Portugal

At the end of 1942 Portugal closed a year full of problems for Europe's only unsurrounded neutral in World War II. Her non-belligerency is her own choice and also that of outside powers. She is non-partisan one might say, by necessity and by request.

Neutrality problems confronted her in late 1941 in the Pacific, when the Netherlands and the British occupied Portuguese Timor; in February 1942 when the Japanese drove out the Dutch and English and seized the territory; in autumn of 1942, with the United Nations' move on West Africa; and the year ended with the Mediterranean Front affording anxiety that the Axis might invade Spain and continental Portugal.

During the year, the 556-year-old alliance with Britain weathered the strain of Timor's occupation. Relations tautened with the Axis, particularly Japan, due to the Japanese invasion of Timor. President Carmona was reelected. Imported foods diminished, though quantities of these were smuggled into Spain and sold to Axis agents. Relations with the United States took a practical turn with a trade agreement. And Portugal continued to nourish happy relations with Spain on the one hand, with Brazil on the other.

Portugal's world position and European locale explains much of her war attitude. Her continental 34,000 sq. mi. with 6,000,000 population, is augmented by her empire of 825,000 sq. mi. with nearly 10,000,000 population; this includes Atlantic Islands, territory on the African mainland west and east, locations in India and islands in the western Pacific. Such an empire rests on shipping, but Portugal's insufficient navy has for nearly 600 years required Britain as an ally, who then can use these friendly spots herself. In war, Portugal must, short of being invaded, start with neutrality, and if this is impossible, join up with Britain.

Portugal's Atlantic Islands include the Cape Verde, whose strategic value off Africa's western hump is axiomatic. More vital, the Azores are equidistant (about 1,200 miles) from United States bases in Newfoundland; from southern England; from the West Africa just wrested from the Axis; and from the Cape Verde Islands.

On the continent, all of Portugal's land frontiers adjoin Spain, from whom (and there have been centuries of wars between the two) or across whose terrain, land forces could, say experts, occupy all of Portugal's ports in 12 hours. Thus, peace with Axis-aided Franco, becomes imperative. And peace with the United Nations becomes a sine quo non.

Portugal's internal picture evidences paradoxes. She is largely Catholic, thus leans towards Rome and currently toward Madrid, and away from the Soviet. When the Axis was allied with Russia, people and government disapproved. When Hitler broke with Stalin, they were bewildered to see their ideological foe become the colleague of their ancient British ally. The past two years have thus underlined neutrality from the domestic standpoint.

The apparent quiet in home politics was no indication of the state of mind of the public. Japan occupied Timor in February. In March, fresh troops left Portugal for Mozambique. In May, Capt. Ribeiro Casais, Assistant Chief of Staff of the Portuguese Legion (a green-shirt organization, to which every Portuguese man and boy must belong) broadcast the coming defense measures, including blackout of the capital, gas-decontaminating centers and the use of gas masks if and when necessary. By July, air raid precautions in Lisbon were dismaying the people. Living problems evidenced no hope of diminishing, including lack of gasoline, lack of fuel, reduced lighting in streets and homes. Food was growing scarce by August, prices were rising. Fishing boats feared to go far; Germany was forcing the shipping to her of part of the sardine output, and her return shipments of cod were inadequate and costly; Britain promised tin for sardine cans in return for part of the catch; about 50 per cent of the available meat and fish and fruits were reported smuggled to German agents in Spain. Shipping was scarce, due to torpedoing and lack of building material for replacements.

Not to be cloaked in secrecy was the evident intent of the Government to send the best part of her army (some 75,000 men) to the Colonies to avoid capture in case of an invasion of the motherland. Those remaining gave evidence of poor housing, clothing, equipment, with need manifest. And in November, the Allies began their African offensive; and as South Europe remains (probably with increasing stress), the theatre of Axis-Allies strategy, Portugal must needs consider anxiously her relation to Gibraltar, to Spain, to flank attacks within the Atlantic.

1941: Portugal

During 1941 Portugal was primarily concerned with guarding its continental independence against a possible German attack, and preserving its imperial unity against precautionary measures threatened by enemies of the Axis. The country's dual rôle as a European and an overseas power made the rigid enforcement of its neutrality a matter of life or death. The Lisbon Government feared that any move toward assisting the Allies would bring on German occupation of the country, while any inclination to collaborate with the Nazis might lead to seizure of its strategic island bases by Great Britain or the United States.

Diplomatic Crisis with the United States.

A serious diplomatic crisis followed President Roosevelt's 'unlimited national emergency' speech of May 27, in which the American Chief Executive stated that German occupation of Portugal's Azores and Cape Verde Islands would 'directly endanger the freedom of the Atlantic and our own physical safety,' and therefore that 'it would be suicide to wait until they [the Nazis] are in our front yard.' Senator Claude Pepper specifically advocated United States occupation of the Portuguese islands. After these public utterances, a wave of national indignation and anti-American sentiment swept over Portugal. On May 30 the Lisbon Government lodged a formal protest against President Roosevelt's intimation that the United States might deem it expedient to occupy Portuguese islands. Although the State Department reassured Lisbon on June 10 and 13, anti-American feeling ran high throughout the summer. On July 12, Portugal sent to the Azores the fourth contingent of troops in three months, the largest defense force ever sent to the colony. Two weeks later President Carmona visited the Azores for the first time, and on Aug. 5 the Portuguese Government imposed travel restrictions on all aliens entering the colony, where Pan American Airways maintained a base. In mid-August, however, a Portuguese emissary to Rio de Janeiro informally suggested that it might be advisable for Brazil, with United States support, to undertake protection of the Atlantic colonies in time of crisis.

Portugal's Far Eastern colonies were directly affected by impending war and the outbreak of hostilities in the Pacific. In January 1941 the British established regular air services between Australia and Portuguese Timor, located 450 miles from the Australian naval base at Port Darwin. Following Japanese demands for a similar concession, Lisbon agreed on Oct. 14 to permit Japan to set up an airline between Timor and the Japanese-mandated Palau Islands. On Dec. 17 Netherland and Australian forces occupied Portuguese Timor in order to prevent Japanese use of the strategic island. Two days later Prime Minister António de Oliveira Salazar told a special session of the National Assembly in Lisbon that Portugal demanded immediate withdrawal of the Allied Forces. The British and Dutch Governments, while refusing to remove their garrisons in the face of a Japanese menace, promised to do so as soon as the danger period had passed.

Economic Warfare.

The United States and Great Britain cooperated throughout the year in a program of economic warfare against Axis agents in Portugal. Both groups of powers in the present conflict have tried to obtain the bulk of Portugal's strategic products, and have pressed Lisbon to cut down shipments to the enemy. Wartime demands in 1941 caused Portuguese exports of cork, tungsten and tin to reach unprecedented heights. Portugal normally supplies about 60 per cent of the United States imports of cork, one of the 'critical' defense materials, but in 1941 it provided over 90 per cent of total American imports. The sharp curtailment of United States imports of tungsten from the Far East, even before the outbreak of hostilities with Japan, led to heavy buying of this vital mineral in Portugal. A 'tungsten rush' in the summer of 1941 attracted many Portuguese farmers away from their land and for a time threatened the country's food supply, until the Government intervened late in the year to control production, price and export of the commodity.

Natural Disasters.

Two natural catastrophes befell the Portuguese people in 1941. The first, a cyclone of unprecedented violence, ravaged the country on Feb. 15. Telephone and telegraphic communications were interrupted; wharves and quays in the coastal towns were battered; inland factories and other buildings collapsed; rich pine woods and olive groves were destroyed; rivers overflowed and flooded lowland districts. Much of the country's agricultural wealth was lost, and a large part of its fishing fleet wrecked.

On Nov. 25 Lisbon, Madeira and the Azores suffered the most violent earthquake recorded since 1755. Fires broke out in several urban districts, but damage was relatively slight and no casualties were reported. Another quake, classed as 'violent' but less severe than the shock of Nov. 25, rocked Lisbon on Dec. 27. Although it deplored losses incurred during the cyclone and the earthquakes, Portugal recognized that its neutrality had spared the country much greater sacrifices which other European peoples had been forced to make.

1940: Portugal

The year 1940 was a memorable one for Portugal, chiefly because of Lisbon's role as first-ranking wartime port of entry into and escape from the entire continent of Europe. Owing to the country's unique geographic and political position—serving as a continental window on the Atlantic, and enjoying the friendship both of Axis powers and Allies—Portugal hummed with the lively transit of diplomats, newspaper correspondents, war refugees, business men, and all sorts of supplies. The country suffered from wartime restrictions on its trade during the first half of 1940, when Great Britain was absorbing four-fifths of Portuguese exports; but after the military collapse of France, Portugal was able to trade freely with both groups of belligerents. Despite the loss of markets for its colonial products, and a rise of about 7 per cent in living costs during the year, at the end of 1940 Portugal was in an extraordinarily favorable situation in comparison with other European countries.

Foreign Relations.

Although in October 1939 Prime Minister Salazar had reaffirmed Portugal's fidelity to its 553-year-old alliance with Great Britain, the Government maintained during 1940 a rigid neutrality. The Portuguese controlled press printed an equal amount of news from the major contestants in the war, and carefully avoided editorial comment on controversial issues. In theaters, the people—said to be strongly pro-British—were forbidden to applaud newsreel references to either side. Italy's entry into the war intensified Portugal's determination to remain neutral, owing to the long tradition of friendship between the Italian and Portuguese nations, their close ties of race, language and religion, and their association in support of General Franco during the Spanish civil strife. On July 29, Portugal and Spain signed an additional protocol to their existing treaty of friendship and non-aggression, which had been concluded March 16, 1939. In this protocol the two governments bound themselves 'to consult each other on the best means of safeguarding, in so far as possible, their mutual interests, whenever events are anticipated or actually take place which by their nature may compromise the inviolability of their respective home territories, or may constitute a danger to the security or independence of either contracting party.' In view of Spain's tacit partnership in the Rome-Berlin Axis, the July 29 agreement was a significant step to insure Portugal against the dangers which would follow the possible extension of hostilities to the Iberian Peninsula. (See GIBRALTAR.) In July and August, the Portuguese Government dispatched infantry forces of 1,000 men each to Angola and Mozambique, to augment the garrisons of its African colonies, although its apparent failure to strengthen home defenses necessitated increasing reliance on its ability to court favor in both camps of European belligerents. (See also RELIGION: Roman Catholic Church.)

Centenary Commemoration.

On June 1 Portugal opened a six-months celebration of the 300th anniversary of its independence, and the 300th anniversary of its restoration after sixty years of Spanish rule. The ceremonies were divided into three phases, honoring the medieval period of Portugal's history, the imperial period, and the Bragança period. (The Bragança dynasty reigned in Portugal until the establishment of the Republic in 1910.) Three great construction projects—all near Lisbon—were undertaken in connection with the commemorative celebrations: (1) A large Olympic Stadium at Cruz Quebrada; (2) an International Air Port at Portala; and (3) a deluxe coast-road from Lisbon to Estoril and Cascais.

1939: Portugal

The outbreak of war in Europe greatly increased Portugal's diplomatic and economic problems during the last months of 1939. German influence, which had grown considerably in previous years, was noticeably weakened by the Nazi-Soviet pact of August. Germany's invasion of Poland, moreover, was condemned by the Primate of the Church in a pastoral letter issued Oct. 10. Early in September, Portugal proclaimed its neutrality. The Prime Minister declared Oct. 10 that this action was welcomed by Great Britain, and reaffirmed the historic Anglo-Portuguese alliance. Dr. Salazar stated that Germany had agreed to respect Portugal's neutrality and overseas possession. Portugal resumed normal relations with Spain, signing a treaty of friendship and non-aggression on March 16, and a commercial agreement on Dec. 13.

To safeguard its neutrality, Portugal undertook to expand its armed forces and to improve its economic position. The Government kept a close watch over shipping in both home and colonial ports, and sealed the wireless apparatus of all vessels in these ports. It issued decrees providing for control of exports and imports, reinforcement of industrial activity, prevention of speculation in commodities, and the rationing of consumers if necessary. As the war began to hamper normal trade with Great Britain and Germany, Portugal's relations with the United States showed improvement. With the aid of credits from the Export-Import Bank, Portugal agreed Oct. 3 to purchase $5,000,000 worth of American railway equipment on a modified barter basis, as an American firm undertook to sell an equivalent amount of Portuguese products in the United States. On Nov. 2, the Government ordered 72 American bombing planes, to cost $75,000 each.

Until the outbreak of war, the Portuguese economy improved to some degree. Industrial production increased, mining and textile output rose, and unemployment decreased because of public works. The wheat crop was slightly better than the exceedingly poor crop of 1938, while some other agricultural products improved. The sardine industry suffered severely from small catches and depleted stocks, and sardine canning declined 40 per cent from the previous year. The war disrupted Portugal's normal trade and shipping, creating deficiencies in coal, tin plate, chemicals and cotton. Although Portugal remedied some of its commercial difficulties later in the year and expected to enjoy a prosperous transit trade, it faced a serious decline in exports and loss of revenue from reduced imports.

1938: Portugal

The Government of Dr. Salazar, throughout 1938, continued its program for budgetary economy, rehabilitation of the defense forces, and extension of the corporative system. The Government showed a surplus of 211,000,000 escudos for the fiscal year ending Dec. 31, 1937 — its ninth successive balanced budget — and predicted a small surplus for 1938. A three-year naval program was announced on May 3, providing for the acquisition of twenty new units, including three submarines and three destroyers, and four squadrons of complementary aircraft. Business remained rather dull throughout 1938, industrial production changing very little from the 1937 level, but employment improved slightly. Agricultural production declined seriously, almost every crop except wine grapes and chestnuts showing a decrease. Wheat production was still below the needs of domestic consumption despite Government efforts to promote self-sufficiency. Foreign trade declined sharply, partly because of unsettled conditions in Europe, and all exports — especially cork, fish and wine — suffered.

Portugal's international position continued to be uncertain because of the Spanish conflict. Having favored the Franco cause throughout the war, the Portuguese Government in June promoted its agent in Burgos to the rank of Ambassador, while General Franco similarly advanced his representative at Lisbon. Portugal severed relations with Czechoslovakia on Aug. 19 and dismissed the Czech Minister a few weeks later, owing to a disagreement over an order of machine guns placed with the Zbrojovka factory in Prague. Reports differed as to whether the diplomatic crisis arose over the inability of the firm to supply new-type guns on time or over its insistence that they be used in Portugal and not in Spain. Germany sought to increase its influence in Portugal by sending a fleet of warships to Lisbon at the same time that a British fleet, including the battleships Rodney and Nelson, were paying a formal visit, and by offering to sell munitions, and to train the Portuguese forces.

The British Government meanwhile endeavored to reinforce its alliance with Portugal, dating from the fourteenth century, by parliamentary declarations and goodwill missions. Britain's obligation to defend Portuguese territory was reaffirmed in the House of Commons on Dec. 22, 1937 by Foreign Minister Anthony Eden and on March 24, 1938 by Prime Minister Neville Chamberlain. A British military mission, consisting of Army, Navy, and Air representatives, left for Portugal in February 1938 and spent many months visiting various parts of the country and advising the Government on defense questions. A British engineer, Rear-Admiral R. C. Hugill, was appointed Naval Industrial Director in November, to organize the new arsenal and dockyard at Lisbon. Further indication of British interest in peninsular affairs was given in May, when an Anglo-Portuguese Society was established in London, with the Portuguese Ambassador as President.

The Portuguese Government exhibited growing concern over its colonial empire, following the victories of Germany in Central Europe and reports that the Nazi régime would soon demand territories in Africa and elsewhere. President Carmona was formally entertained in Principe, São Thomé and Angola, West Africa, during the summer, the first Portuguese head of state ever to visit the empire. The Prime Minister, Dr. Salazar, and other officials frequently proclaimed Portugal's intention to retain its colonies and warned that no concessions to Germany or other powers could be contemplated. The autumn visits of Oswald Pirow, South African Defense Minister, to Lisbon, London, and Berlin was widely rumored as presaging colonial concessions, but Portuguese officials maintained that only African economic and military questions were discussed. The Salazar Government claims that it has improved the colonial administration and contributed to economic and social progress throughout the empire.