Term for a contract between England and Portugal, which was completed on 27 December 1703 in Lisbon. He is named after the English politician and Lord Chancellor John Methuen (1650-1706), who, as an extraordinary ambassador to Portugal, negotiated this historically significant agreement. In essence, it was about tariff concessions for the import of Portuguese wines in England. Specifically, the treaty provided that England could export textiles to Portugal (and its colonies) without hindrance, while Portugal port wine exported to England. It was particularly advantageous for England, for it acquired a market for its products during the beginning of the Industrial Revolution and made Portugal economically dependent on England.
Sales of Portuguese wines were subsidized on all other European wines, in particular France. England got the wine at a third cheaper price than French or European wines. The contract was the cause of a boom in Port wine production and displaced in England, the wines from Bordeaux and Burgundy in back seats. For Portugal, the contract was a great disadvantage because its textile industry was destroyed and as a result the industrial revolution took place much later and to a lesser extent. See also under Factory House,