Franco's Regime: Economic Shift 1959-1975

Stage 2: 1959-1975

Since 1947, the configuration of two antagonistic blocs (the USSR and the USA) and the beginning of the Cold War significantly altered the international situation. Although verbal condemnations of Franco remained, they gradually gave way to international acceptance of the regime. For this reason, in 1951, Franco decided to restructure the government. The new government initiated a period during the Franco era characterized by the predominance of Catholic nationalism, and Admiral Luis Carrero Blanco was named Secretary of the Presidency.

In 1953, Franco received definitive international recognition of the regime with the signing of agreements with the United States and the concordat with the Holy See. The Vatican demanded, in return, the explicit denominational restoration of the State and considerable privileged status for the Catholic Church. The agreements with the United States covered economic and defensive aspects, and the two countries pledged mutual assistance in case of conflict. The Americans obtained the right to establish and use a series of military installations on Spanish soil (the bases of Torrejón, Morón, Zaragoza, and Rota).

In 1957, Franco made a new restructuring of the government in line with that started in 1951, pushing out the Falangists and promoting Catholic sectors. Upon the recommendation of Carrero Blanco, men from Opus Dei, called technocrats (Navarro Rubio and Ullastres), came as ministers and occupied key positions in the country's economic direction. This new generation of politicians, most of whom had not participated in the Civil War, staged the next stage of the Franco regime, characterized by enormous growth in the 1960s.

The Turn of the Spanish Economy

The government formed by Franco in 1957 and his successors in the 1960s marked a turn in the Franco regime. It led to a phase transition from the first ominous Falangism to the principles of a second era with a predominance of technocrats. They carried out a technical reform, without undermining the dictatorship, to overcome the serious economic and social situation arising out of autarky. Thus, with Europe recovering from World War II, Spain was ready to seize this favorable situation.

The first action that took place was the Stabilization Plan (1959), aimed at ending the strong state interventionism of the previous years and removing barriers to trade and financial liberalization. The Stabilization Plan was followed in the 1960s by the implementation of the Plans of Economic and Social Development. Three plans were issued, each for a period of four years. To supervise the operation, a Commissioner of the Development Plan was created, and Laureano López Rodó was appointed commissioner. This was an indicative economic planning to encourage growth from the state of the Spanish economy, from programming and public sector activity, to provide information and predictability for private investors.

The greatest achievement of the development plans was providing private infrastructure (electricity, oil refineries, roads, etc.) and basic materials (steel, coal, aluminum, etc.) that contributed to industrial growth.