On December 27, 1703, the famous Methuen treaty was signed, by which Portuguese wines might be imported into England at a lower duty than those from France and Germany, in return for a similar concession to English manufactured goods. The immediate result of this treaty was that King Pedro acknowledged the Archduke Charles, the English candidate, as King of Spain, and that he gave the English a base of operations in the peninsula. The ulterior result was that Englishmen in the eighteenth century drank port wine instead of claret and hock, while the Portuguese imported everything they wanted beyond the bare necessaries of life from England. This was an advantage to both nations, for Portugal is eminently an agricultural country with neither the teeming population nor the materials necessary for manufactures, while England obtained a friendly province from which to import the wine and produce of a southern soil, and a market for the sale of the products of her manufactories. The close connection thus formed went deeper than mere commerce; it established a friendly relationship between the two peoples, which was of infinite advantage to the smaller nation. At Lisbon a regular English “factory” was established, and at Oporto a large colony of English wine merchants and shippers carried on business operations, which doubled the prosperity of the beautiful city on the Douro. The steady influx of English capital increased the wealth of Portugal, and the vineyards of the Entre-Minho-e-Douro became proverbial for their prosperous and industrious peasantry; while, on the other hand, the importation of English goods gave means of comfort and luxury to the Portuguese people which distinguished them in the eyes of all travellers of the last century from the Spaniards and Italians. To this day the beautiful porcelain from the famous English works at Worcester and Derby, Chelsea and Bow, is to be found in Portuguese cottages; and the English people have not lost their taste for port and St. Michael’s oranges. [Illustration: OPORTO. PRESENT STATE. (_After a Photograph._)]