Abstract: Foreign Assistance to a "Closed Economy": The Case of French Firms in Spain, c. 1941-1963

Rafael Castro Balaguer and Esther M. Sánchez Sánchez

Abstract

Spain emerged from the Civil War with formidable economic problems. They were caused by military destruction and foreign condemnation and especially by the establishment of an autarkic system, in which the victorious Francoist side followed the political and economic path of other European fascist regimes. Despite these legal restrictions, many foreign entrepreneurs and multinationals continued to seek out and exploit both new and old relationships in Spain, usually in association with the state-owned Instituto Nacional de Industria (INI). This foreign support was a major factor in ending Spain's international isolation, increasing confidence in the Spanish economy and removing obstacles for the growth of the 1960s. The purpose of this paper is to analyze the collaboration between French firms and the INI in the early Franco era, identifying the main enterprises, agreements and results. We assert that foreign assistance to Spain was present during the autarky period and highlight the continuity of the collaboration between Spain and France. Therefore, we defend multinationals' flexibility in adapting themselves to a hostile environment, especially across political and economic local networks.