User blog comment:Callumthered/Portuguese Australia?/@comment-32656-20120211074338/@comment-32656-20120211184438

...The Portuguese in Brazil controlled it in a system more or less identical to the activities of the other powers on the Caribbean islands - slaves, with a few landowners. And, even more so, because the Spanish respected the Treaty line there. Had that not been the case, they'd have lost more than half of it.

Portugal - and the Dutch, for that matter - lost out on the colonial race in the end because their populations were far too small to compete with the larger nations. Simply put, there isn't enough people to do any real colonizing. And the Brazil plantation system just wouldn't work in Australia.