Philip III of Spain

Philip III delegated the governance of Spain to his favorite, the Duke of Lerma, who effectively ruled as a prime minister. Lerma's administration was marked by corruption, favoritism, and a decline in royal authority, contributing to the economic and political decline of Spain.

Under Philip III, the Spanish crown declared bankruptcy for the third time in its history, unable to service its massive debts from the Habsburg wars. The bankruptcy led to a suspension of payments to creditors and a further deterioration of Spain's financial position.

Philip III of Spain ordered the expulsion of the Moriscos, descendants of Muslims who had converted to Christianity, from Spain. Over 300,000 Moriscos were forced to leave, primarily to North Africa. The expulsion caused a significant demographic and economic decline, particularly in Valencia and Aragon.

Philip III signed the Twelve Years' Truce with the Dutch Republic, effectively recognizing Dutch independence from Spain. The truce ended the Eighty Years' War for a period, but it was seen as a sign of Spanish weakness and a concession to the rebellious provinces.