In answering this question it is important to look at all factors concerning the two dictatorships going back for many years before the collapse of these regimes. In Spain's case it was mainly economic factors that caused the downfall of Franco's regime but there was also large scale opposition towards the party, particularly in later years. In Portugal, the main factors for its demise was the colonial wars in Africa and economic repression to name a few. However, the demise of these dictatorships were very different, with Spain's process to democratization being gradual with no abrupt break in the dictatorial process as was the case in all the other European dictatorships whereas the Salazar/Caetano regime was very immediate.
Franco's economic policies of the late 1950's and 1960's were one of the principle reasons for the demise of the dictatorship. With the economy on the verge of collapse in the 1950's through the inadequacy of the restrictive policies of autarchy that had been practiced since the end of the civil war, a new team of technocrats of the Opus Dei, Ullastres, Navarro Rubio, and Lopez Rodo, entered the cabinet in 1957 and were able to institute a number of reforms. After a period in which the economy was stabilized, it then proceeded to enjoy an economic boom. The Spanish economy grew in the 1960's and early 1970's at a pace unrivalled in Europe and matched only by Japan. Combined with rapid industrialization, there was also a fundamental demographic shift away from the rural Spain as more of the rural population moved to the large industrial towns, greatly increasing the size of the industrial proletariat. By 1965, the uninterrupted growth of the economy, and the prosperity it provided reduced the regimes repressive capabilities as it increasingly came to realize that economic growth could only be maintained with the goodwill of the new industrial classes.
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This "economic miracle" involved an unusually high degree of movement of peoples as well as goods and capital. Tourism played a key role in this characteristic as the total number of foreign visitors grew from 6 million in 1959 to 34 million in 1972, the level at which it stayed for most of the 1970's. The emigration of a large number of the Spanish workforce formed another source of movement of peoples in the 1960's. This led to workers sending remittances back to Spain. Tourism and worker emigration helped ensure that benefits of the economic growth would be widely distributed among the Spanish population as they benefited small-scale enterprises primarily rather than the small group of elites. However, these promising aspects of the economy also had serious outcomes for the dictatorship. Because of tourism, Spain was flooded with foreign articles and newspapers which provided, for the educated elite, uncensored sources of information. It also forced the Franco government to exercise political restraint. As Spain's largest source of foreign income at the time tourism could not be endangered by the repressive policies that had characterized the government for so long. Also the existence of a large Spanish workforce abroad was an indication of one of the shortcomings of the economy, the lack of full employment and the decline of skilled labour.
Another departure of the regime's earlier economic policies was Spain's integration into Europe, Ullastres repeatedly asserted that the aim of the new economic policy was to "integrate" Spain in the booming world of advanced Western capitalism, particularly into the European market.
The Plan of Stabilization of 1959 aimed to address the crisis of Spain's balance of payments by removing physical controls, opening the country to foreign investment, freezing wages and limiting credit. The immediate result was recession and unemployment with the idea that once the policy started working, the economy would function as a modern capitalist economy in which rapid growth would take care of all problems. Spain was now part of the world capitalist market, something that showed a contradiction with Franco's earlier policies of isolation in Europe.
However, Spain was not a member of the EEC, a fact that the economic elite were well aware of. They believed that this was holding them back as "the benefits that it conferred could be provided equally well by a stable democracy of the European type, and the regime increasingly came to be regarded as an obstacle to economic growth." The decline in support for Franco was probably greatest among modern, internationally orientated industrialists but agricultural producers also saw the benefits from entry into the EEC. Franco's regime could not offer a prospect as appealing as "Europeanization" and this implied democratization.
Franco's economic policy initiated these developments and the government using the modernization of the economy to ensure its power meant a change in its political strategy. This had previously relied mainly on repression of any political opposition and the use of propaganda. Spanish industry that was linked to multinational firms pressed for further liberalization and "they hoped for an opening-up of Spain vis-а-vis the Common Market, and were even prepared to pay the price of political liberalization to gain it."
Also, fundamental changes in the economic circumstances created changes in the social structure. Increasing prosperity brought expectations and growing industrial unrest. Though strikes were still illegal, the total number of hours lost in strikes between 1966 and 1970 had increased by 480% and these strikes were taking on a political as well as an economic complexion.
Although opposition was also still illegal, it emerged through the system in the form of working class protest and student rebellion through strikes, public demonstrations and confrontations with the police. A more violent form was Basque separatism, the tactics of the organization known as ETA. Even the Church, once a loyal ally, distanced itself from the regime and the upper clergy withdrew its support from Franco, "leaving his regime bereft of the religious sanction it had once been able to take for granted."
Tensions were mirrored in the regime itself between the "liberal" Opus Dei, who wanted continuing economic development, and the "fundamentalist" Falange, who saw a danger in modernization. The Falange emerged victorious as the new cabinet of 1969, headed by Carrero Blanco, reversed the liberalization of the 1960's and began a program of repression. This further fuelled discontent and narrowed the regime's already fragile support. These policies were reversed after the assassination of Blanco in 1973. This highlighted the fact that the regime had lost its way and merely exacerbated the divisions within it.
The end of the regime came shortly after the death of Franco in 1975. King Juan Carlos 1 had been appointed by Franco to act as the head of state of an authoritarian monarchy and right-wing elements of the regime still favored this strategy. However, both Juan Carlos and Adolfo Suarez (PM from July 1976) believed that the continuation of the dictatorship would result in civil war and proceeded to dismantle Francoism and guide Spain to democracy which they achieved in June 1977 when Suarez's Union of the Democratic Centre (UCD) won the election.
In Portugal the situation was very different as Salazar, from the beginning, wanted to keep Portugal, as far as was possible, a rural society and wanted to avoid modernization and liberalization Industrial and financial opportunities were created but were only available to those who were able to develop large-scale industrial projects. Although economic opportunities were restricted, important effects were made to change infrastructural conditions such as the public investment in roads, dams, ports and power production and the promotion of industrial and agricultural modernization by some Ministers of the Economy, Barbosa and Dias. This led to an integration of Portugal in Europe. However, it was clear that Portugal could not become a member of the EEC as the founding members would not accept a country without democratic roots and "for the Portuguese authorities, it would not be acceptable to be included in an organization with supranational powers." Therefore, when Portugal joined the European Free Trade Association (EFTA), it was able to retain markets and maintain exports and they could hold a much stronger position in future discussions with the EEC. This was a liberalization of economic policy that Salazar wanted to stay away from but to stay away exclude themselves from all European movements would have led to the loss of existing markets.
Portugal has traditionally been a country of emigration but from the late 1950's and all the way through the 1960's there was a large shift away from traditional destinations such as Brazil and towards the Europeans Communities. By 1975, about 1.5 million Portuguese were living outside Portugal. This led to a decline in the agricultural workforce as two out of three people leaving the countryside went abroad.
The remittances of the overseas Portuguese had a significant impact on the domestic economy and for a while, "Portugal benefited from Western Europe's growth and prosperity. Later on, however, Portugal proved vulnerable to economic recession and stagnation."
Throughout its entire existence, Salazar's Estado Novo (the New State) had one particular source of strength and weakness, which was Portugal's colonies overseas. Salazar saw these as important possessions for four reasons. First, they were of historic importance. Second, it guaranteed Portugal a world role. Third, Portugal had an historic obligation to "civilize" and convert the peoples of Africa and finally, the overseas empire was of economic importance, supplying Portugal with raw materials and providing markets for its goods. Therefore, when its colonies pressed for independence, Salazar had no intention of giving it to them which led to war with its African colonies, most notably Angola and Mozambique. One of the first effects of this was that the number of regular soldiers and conscripts was increased which had an overwhelming influence as by the late 1960's one in four men of military age were in the armed forces.
The war also led to a huge increase in public spending as almost half of the total public expenditure in this period was concentrated on the military. Industrialists were strongly critical of the colonial war, although they did not say so, which was causing serious labour shortages and diverting resources needed for expansion. This was especially so as the opening towards Europe and North America meant that there was less need for colonial markets and raw materials. Much of the Portuguese population recognized that this was a war that they could not win and did not want to fight in but their leaders did not recognize this. At the same time, they were fighting a war that seemed never-ending, and in any case they realized that it would not end with victory on the battlefield.
Marcelo Caetano replaced Salazar in office in 1968 and in the beginning of his premiership he took some steps towards liberalization. Political exiles were able to return home, Censorship was reduced in books, journals and films. SEDES (Social Development Study Group), an association of intellectuals, was set up and the political police (PIDE), instrumental in carrying out the repressive reforms of Salazar, had their activities reduced. However, this liberalization was stopped in 1972 as Caetano was apparently unable to overcome conservative interests and so abandoned his original aims.
Meanwhile, economic conditions were deteriorating. Largely as a result of the oil crisis and the onset of world recession Portugal found itself with rapidly rising prices, accelerating labour unrest and middle-class disillusionment with the regime. This, along with the continuing war in Africa led to the coup d'etat of April 25th 1974. This was carried out by a group of junior and middle rank officers, convinced that a coup was the only way to a political settlement. This overthrow of power was met with widespread popular support and there was very little support for the regime. "It was the army that pushed, but it pushed a structure so fragile that it fell like a stack of cards."
To conclude, it can be seen that the processes which led to the decline of these regimes often had some similarities and differences but the way in which the demise was reached was extremely different. In looking at this, it is important to note that Franco, Salazar and Caetano were not looking for the best way to improve the countries they had control over but were looking for a way of sustaining power, as is the case with all dictatorships, which ultimately leads to unrest once the interests of the population are not met as best they can.
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