António de Oliveira Salazar
Despite the authoritarian character of the regime, Portugal did not experience the same levels of international isolation as Spain did following World War II. Unlike Spain, Portugal under Salazar was accepted into the Marshall Plan (1947–1948) in return for the aid it gave to the Allies during the final stages of the war. Furthermore, also unlike Spain, it was one of the 12 founding members of the North Atlantic Treaty Organisation (NATO) in 1949, a reflection of Portugal's role as an ally against communism during the Cold War in spite of its status as the only non-democratic founder. In 1950, Portugal joined the European Payments Union and participated in the founding of the European Free Trade Association (EFTA) in 1960 and the Organisation for Economic Co-operation and Development in 1961. It joined the General Agreement on Tariffs and Trade in 1962, and finally, Portugal signed a free trade agreement with the European Economic Community in 1972, still under the auspices of the "Estado Novo".
Portugal during World War II
At the outbreak of World War II, Portugal was ruled by António de Oliveira Salazar, the man who in 1933 had founded the "Estado Novo" ("New State"), the corporatist authoritarian government that ruled Portugal until 1974. Salazar's dislike of the Nazi regime in Germany and its imperial ambitions was tempered only by his view of the German Reich as a bastion against the spread of communism. He had favoured the Spanish nationalist cause, fearing a communist invasion of Portugal, yet he was uneasy at the prospect of a Spanish government bolstered by strong ties with the Axis. Salazar's policy of neutrality for Portugal in World War II thus included a strategic component. The country still held overseas territories that, because of their poor economic development, could not adequately defend themselves from military attack. Upon the start of the war in 1939, the Portuguese Government announced on 1 September, that the 600-year-old Anglo-Portuguese Alliance remained intact, but that since the British did not seek Portuguese assistance, Portugal was free to remain neutral in the war and would do so. In an aide-mémoire of 5 September 1939, the British Government confirmed the understanding.