The roots of that era stretch back to the 15th century when Portuguese explorers such as Vasco da Gama put to sea in search of a passage to India. By the 16th century these sailors had helped build a huge empire embracing Brazil as well as swathes of Africa and Asia. There are still some 200 million Portuguese speakers around the world today.
Portugal's history has had a lasting impact on the culture of the country with Moorish and Oriental influences in architecture and the arts. Traditional folk dance and music, particularly the melancholy fado, remain vibrant.
Jeronimos Monastery: Portugal is becoming an increasingly popular tourist destination
For almost half of the 20th century Portugal was a dictatorship in which for decades Antonio de Oliveira Salazar was the key figure. The dictatorship's stubborn refusal to relinquish its grip on the former colonies as demands for independence gained momentum there resulted in expensive wars in Africa.
This period was brought to an end in 1974 in a bloodless coup, picturesquely known as the Revolution of the Carnations, which ushered in a new democracy.
By the end of 1975 all of Portugal's former colonies in Africa were independent of Lisbon.
Since becoming a member of the then European Community in 1986, Portugal's traditionally largely agricultural economy became increasingly diversified and orientated towards the service sector.
It experienced solid growth in the 1990s, but GDP per head remains well under the EU average. The 2008 financial crisis left Portugal with a ballooning budget deficit, and in 2011 it became the third EU country after Greece and Ireland to ask for a financial bail-out.
Anibal Cavaco Silvo: Former centre-right PM, now president
Anibal Cavaco Silva won the January 2006 presidential poll, becoming the first centre-right president since the coup of 1974. He defeated two Socialist candidates to win a first round election victory.
The president's role is mainly ceremonial, but incumbents can appoint prime ministers, dissolve parliament and call elections.
Prime minister: Pedro Passos Coelho
Mr Passos Coelho heads a coalition government formed in June 2011 and charged with steering the country out of financial crisis.
Mr Passos Coelho has pledged to implement harsh spending cuts
His Social Democratic Party won parliamentary elections, but as it failed to gain sufficient seats to govern alone it teamed up with the Popular Party.
His government was compelled to implement austerity measures and economic reforms in return for a rescue package.
On taking office Mr Passos Coelho said that his new government considered bringing the country's public finances under control to be an "urgent imperative".
He said government objectives would be carried out "in conformity" with the bailout agreement signed with the European Union and IMF. Under the deal the country was obliged to cut the budget deficit to 5.9 percent of gross domestic product in 2011 from 9.1 percent in 2010.
The debt crisis in Portugal, alongside the crisis in Ireland and the most serious crisis in Greece, caused deep concerns internationally about the resilience of the European Union's economy.
Mr Passos Coelho defied criticism of having limited political experience to lead his party to a convincing win in the June 2011 general election to oust the ruling Socialists on a ticket of sweeping change.
Observers speculated that as a politician-cum-business manager, Passos Coelho's executive skills and frugality could help him to pursue a tough austerity policy under the terms of the bailout programme.
Portugal's commercial TVs have a lion's share of the viewing audience, and provide tough competition for the public broadcaster.
Public TV is operated by RTP. The main private networks are TVI and SIC. Multichannel TV is available via cable, satellite, digital terrestrial and internet protocol TV (IPTV). Cable is the dominant platform.
Public radio is operated by RDP. The Roman Catholic Church owns the popular Radio Renascenca. There are some 300 local and regional commercial radios.
There were 5.2 million internet users by June 2010 (Internetworldstats).
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