João IV was proclaimed king by a cortes convoked in 164l. Faced with the general ruin of the realm and threats to his crown from Spain, his first act was to defend the kingdom. He immediately created a council of war, appointed military governors in the provinces, recruited soldiers, rebuilt forts, and construÍÍÍÍcted an arms foundry. At the same time, he vigorously sought diplomatic recognition of his monarchy and Portugal's independence from Spain. On June 1, 1641, João IV signed an alliance with Louis XIII of France and soon made peace with Holland and England. By the time of his death in 1656, João IV had consolidated and restored the monarchy by making peace with former enemies, recouped some lost colonial possessions, and defeated Spanish attempts to reincorporate Portugal into the Iberian Union.

When João died, his queen, Luísa de Gusmão, became regent because the royal couple's oldest son, Teodósio, had died three years before his father and their youngest son, Afonso, was only ten years old. Although a disease in infancy had left Afonso partially paralyzed and had impaired his intelligence, his mother succeeded in having him proclaimed king. Afonso VI (r.1662-67) grew into a degenerate who preferred riding, coursing bulls, and watching cockfights. His marriage to Marie-Françoise Isabelle of Savoy was annulled, and, in 1667, aware of the need for a successor, Afonso consented to his own abdication in favor of his brother, Pedro. During this period, the Portuguese managed to fight off the last attempt by Spain to reincorporate them into the Iberian Union by defeating the Spanish invaders at Ameixial near Estremós. In 1666, three years after this victory, Spain at last made peace and recognized Portugal's independence.

When Afonso abdicated, he was banished to Terceira Island in the Azores and his brother, who had married Marie-Françoise, assumed the regency of the throne until Afonso's death in 1683, after which he ruled in his own right as Pedro II until 1706. During his regency, Pedro had given the task of producing a coherent economic policy to Luís de Menenses, count of Ericeira, who was appointed head of the treasury. Known as the "Portuguese Colbert," Ericeira implemented mercantilist policies in Portugal similar to those of France. These policies sought to protect Portuguese industries against foreign competition. He published laws to enforce sobriety and criticized luxury. Ericeira organized the textile industry and imported looms from England. He stimulated the national production of wool and silk by decreeing that only Portuguese woolens and silks could be worn.

Data as of January 1993