Spain’s Autarky (1939-1959): Economic Hardship & Recovery
Spain’s Autarky (1939-1950): A Period of Hardship
The period of autarky (1939-1950) in Spain was marked by time constraints due to power struggles, hunger, and widespread misery. People queued for long hours to obtain food and basic necessities. This situation arose from the economic policies of the initial period, compounded by the international situation, including World War II and Spain’s political isolation. General Franco’s regime was isolated due to its association with the Axis powers during the war.
In 1941, the Instituto Nacional de Industria (National Institute of Industry) was created to enable the state to produce essential goods that private firms were unable to provide, addressing critical deficits. The aim was to leverage equity, but this proved impossible for goods like cotton and oil, which were not produced domestically. Food production was insufficient, leading to state rationing and fraudulent import licenses.
State intervention in production and distribution, coupled with food shortages, rationing, and a thriving black market, characterized this era.
A deliberate policy of deindustrialization was implemented in Catalonia and the Basque Country, regions considered politically disaffected and socially dangerous. Franco stated in 1944 that he aimed to alleviate congestion in the major industrial centers of Vizcaya and Barcelona. During the 1940s, some companies in Catalonia were forced to relocate to other parts of Spain.
While some entrepreneurs profited from the social peace imposed by the regime, the abolition of unions, the prohibition of strikes, and compulsory affiliation meant that workers had to endure deteriorating living conditions, particularly a decline in real wages despite rising prices. Autarky led to increased social inequality, widespread impoverishment, a corrupt public administration, and a lack of incentive for industrial advancement.
The Long Economic War (1939-1959)
The Spanish Civil War caused significant destruction and economic costs, resulting in a substantial decline in agricultural and industrial production, as well as a fall in national income and per capita income. Economic stagnation and depression persisted for nearly two decades. The Spanish population worked harder than before the war, but working conditions worsened, and living standards declined. Economic indicators in the 1940s remained below pre-war levels.
The 1950s: Recovery and Stabilization
Between 1951 and 1957, Spain began to recover to its 1935 economic state. The regime abandoned autarky and lifted some interventionist measures, including rationing. Labor movements and spontaneous protests against the high cost of living led to better salaries and a slight increase in domestic demand. However, economic growth was unbalanced, resulting in significant inflation following wage increases, rising prices, and increased import costs, which depleted foreign exchange reserves to near insolvency. This situation necessitated a stabilization plan.