The 61-year-old led Portugal to glory at Euro 2016 earlier this month as, after knockout round defeats of Croatia, Poland and Wales, Eder's extra-time goal clinched a 1-0 win over hosts France in the final.
A statement on the Portuguese Football Federation's official website on Monday night revealed Santos had agreed to lead the Selecao towards the 2018 World Cup and then on to Euro 2020.
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