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Why did Spain keep its American empire despite losing European territories?

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Illustration of the Battle of Blenheim showing cavalry and infantry in combat, fallen soldiers, and smoke rising from cannon fire across a hilly battlefield. — War of the Spanish Succession The Battle of Blenheim (August 13, 1704), was the most famous victory of John Churchill, duke of Marlborough, and Eugene of Savoy during the War of the Spanish Succession.

Spain retained its American empire following the War of the Spanish Succession primarily because the conflict’s resolution focused on maintaining a European balance of power rather than the total dismantling of the Spanish monarchy’s overseas holdings.12

While the treaties of Utrecht stripped Spain of its European territories—such as the Spanish Netherlands, Milan, and Naples—the Bourbon Philip V was confirmed as the Spanish monarch. The preservation of the American empire was central to the Spanish state’s survival and its subsequent efforts to centralize administration and extract resources.324

Although Spain kept its colonies, it was forced to make significant commercial concessions to Britain, including the asiento—the exclusive right to supply African slaves to Spanish colonies—and the right to send one ship annually to trade with Spanish America. These concessions reflected the shifting geopolitical landscape, where Britain emerged as the dominant maritime and commercial power, while Spain transitioned into a more centralized, albeit economically challenged, state.321