This chapter examines Portugal’s economic identity which has been shaped largely by its peripheral location, an imperial and Atlanticist history, retarded development and subsequent latecomer industrializer status. Historically, Europe played a part in forging that identity but, for political reasons, the links were downplayed in favour of a claim to ‘exceptionalism’ based on the possession of a world-wide empire, an Atlantic vocation, and an insular vision epitomized by the preference for standing, in Salazar’s phrase, ‘proudly alone’. The upheavals during the 1974 ‘carnation revolution’ overturned the values, myths and identities associated with the old regime without immediately constructing a new national self-perception. Portugal suffered a crisis in its national identity which served to reinforce a sense of international inferiority. Constructing a new identity proved problematic because for Portugal ‘Europeanism’ has been an ambiguous concept for a variety of reasons. Yet it is indisputable that in the second half of the twentieth century Portugal started along a development path that would take it from the periphery towards the centre of the European core. Today a widespread consensus exists among the political elite that ‘there is no alternative’ to a European future. Indeed, a proposal to include a vote on joining the euro zone in a referendum on regionalization was dismissed by the Constitutional Court in July 1998, in part because it might imply that there was some question about Portugal’s commitment to European integration.