In the early decades of the contemporary world economy, Portugal had to perform twice difficult stabilization processes: during the 1890s as a consequence of the collapse of external and public debt payments, and during the 1920s in the wake of the First World War. This paper will analyse these
Portuguese situations: the 1890s stabilization based on leaving the gold standard monetary system and on partial default of the external public debt
payments led to a period of economic stagnation, which lasted until the First
World War, in spite of the good international background provided by the so called belle époque; the 1920s stabilization based on a very tough fiscal adjustment opened the way to an interwar period of slight growth , in spite of the unfavourable international background provided by the problems of the 1920s and the Great Depression during the 1930s (although it was not enough to sustain the liberal republican regime, which was replaced by a military
dictatorship, and later an authoritarian right-wing regime)
