The death of Sebastian I in 1578 saw a dynastic crisis that was resolved in 1580 when Spain’s Phillip II invaded Portugal. Ultimately, Philip III tried to make Portugal a Spanish province, and Portuguese nobles stood to lose all of their power. This led to a revolution in 1640, sixty years after its creation. Portugal and Spain were again split.
About twenty thousand Portuguese New Christians left Portugal for Spain as the Spanish and Portuguese Inquisitions were separate and no extradition provision existed. They would have a 'clean record' and be in one of the largest economies in Europe. Spain was beginning to realise the efect of the large exodus of 1492 Even the Spanish Inquisition concentrated on earlier, “veteran” conversos.
The Age-Old Iberian Rivalry and the Jews Jerusalem Center for Public Affairs, Jewish Political Studies Review 16:1-2 (Spring 2004), Norman Berdichevsky
Psychiatrists use the term "sibling rivalry" to express the jealous and sometimes resentful feelings between brothers and sisters in the same household and apparently this applies to nations as well as individuals. This rivalry has had the unintended consequence of benefiting the Jews on four major occasions - the temporary refuge offered by Portugal in 1497, the Portuguese twenty-year moratorium on the activities of the Inquisition in the early 1500s, the Spanish policy during World War I of pressuring Germany and Ottoman Turkey to allow the Jews exiled from Jaffa and other settlements in Palestine to return to their homes in 1916-17, and the policy of both countries following the fall of France in 1940 of allowing Jewish refugees to transit their countries. Although Jews have often been used as pawns of the ambitions of rival states, the Iberian case is so persistent and has endured so long - even into the twentieth century when both countries had only miniscule Jewish populations - that it demands a more thorough investigation.
Spanish and Portuguese, while mutually intelligible in their written form by educated people, are still far enough apart in their spoken forms to mask irony and sarcasm. Spanish and Portuguese folk music, church architecture, dance, food, humor, and national character are quite distinct and may even have been cultivated to exaggerate a sense of being different. Newcomers from abroad living in Spain are often surprised at the latent jealousy and even hostility between neighboring Spain and Portugal. To this day, the Portuguese and Brazilians are either mildly amused, sarcastic, or shocked when addressed by foreigners in Spanish.
The popular Portuguese press continues to delight in teasing and taunting the Spanish "Big Brother complex," much like the Scots' attitude towards the English, the Slovaks towards the Czechs, or the Danes towards the Swedes. All these rivalries can be reawakened by the outcome of a football match. Portuguese star Luis Figo received death threats and accusations of being a "traitor" when he signed a contract to play for a Spanish team.