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TheSpanish economic miracle (Spanish:milagro económico español) refers to a period of exceptionally rapid development and growth across all major areas of economic activity in Spain during the latter part of theFrancoist regime, 1959 to 1974,[1] in whichGDP averaged a 6.5 percent growth rate per year,[1] and was itself part of a much longer period of an above average GDP growth rate from 1951 to 2007.[1] The economic boom came to an end with the 1970s internationaloil andstagflation crises that disrupted the industrialised world although several scholars have argued that "liabilities accumulated during years of frenzied pursuit of economic development" were in fact to blame for the slow economic growth of the late 1970s.[2]
After a very slow recovery from the devastation of theSpanish Civil War of 1936–1939, the "economic miracle" was initiated by the reforms promoted by a group of economic "technocrats" who, with the backing ofFrancisco Franco, put in place new policies for the economic development of Spain. The "technocrats", many of whom were members ofOpus Dei, were a new breed of politician that had replaced the oldFalangist guard.[3] They abandoned a policy ofautarky and implemented "development plans" which saw the liberalization of trade and the rapid growth of industry, coupled with the normalization of diplomatic ties with the United States and the United Nations after a period of initial isolation from the aftermath ofWorld War II and diplomatic ostracism for its pro-Axis but neutral stance. From 1960 to 1975, Spain enjoyed the second highest growth rate in the world, behind onlyJapan,[4] and grew to become the ninth largest economy in the world.
The rapid economic expansion reinvigorated old industrial areas: theBasque Country andFerrol northern coast (iron and steel, shipbuilding), and in and aroundBarcelona (machinery, textiles, cars and petrochemicals). It also drove an enormous expansion in refining, petrochemicals, chemicals and engineering. To help achieve the rapid development, there was massive government investment through key state-owned companies like the national industrial conglomerateInstituto Nacional de Industria, the mass market car companySEAT in Barcelona, the big steel plant ofEnsidesa inAvilés and the shipbuilderEmpresa Nacional Bazán. With heavy protection from foreign competition in the domestic Spanish market, those companies led theindustrialisation of the country, restoring the prosperity of industrial areas like Barcelona andBilbao and creating new industrial areas, most notably aroundMadrid. Although there was economic liberalisation in the period, key enterprises remained under state control.[citation needed]
Theautomotive industry was one of the most powerfullocomotoras (locomotives) of the Spanish Miracle. From 1958 to 1972, it grew at a yearly compound rate of 21.7%. In 1946, there were only 72,000 private cars in Spain, but in 1966, there were over 1 million.[6] That growth rate had no equal in the world. Theicon of thedesarrollo was theSEAT 600 car, produced by the Spanish state company SEAT. More than 794,000 of them were made between 1957 and 1973. At the beginning of that period, it was the first car for many Spanishworking-class families. However, at the end of the period, it was the second car for many more.[citation needed]
