Spain and the United States - Real Instituto Elcano

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SPAIN AND THE UNITED STATES
Eximbank, a key player in post World War II American foreign economic
policy, provided a $62.5 million credit line between 1953 and 1959 at 3%
annual interest and to be repaid in 40 semi-annual payments starting five years
after the first disbursement. These funds were used for foodstuffs, coal, cotton
and other inputs, equipment for infrastructure, agricultural and steel industry
machinery, electricity industry equipment and other capital goods. Power cuts
and electricity shortages were severe and hindered output growth. Electricity
producers received the largest share (28%) of all capital goods financed with
aid between 1952 and 1963. Eximbank also granted loans of $24 million to
purchase cotton. The $62.5 million was authorised under the General
Appropriation Act. In a second phase of lending, Eximbank used its own
funds and was not limited to a special provision. Between 1956 and 1963 it
loaned $138.3 million, which the Spanish government again used to purchase
capital goods.
The relatively modest amount of funds enabled Spain to overcome serious
shortages of imported inputs needed to put some of her industries back on their
feet, particularly electricity, and in agriculture the machinery and fertilisers
enabled Spain to produce more food. Basic infrastructure, such as roads and
rail track (heavily damaged during the Civil War) was improved and the
foreign exchange shortage alleviated. The evidence suggests that without the
easing of severe bottlenecks and shortages, albeit to a limited extent, the
Spanish economy would not have been able to grow at the speed it did during
parts of the 1950s. While the US aid was significantly lower than that received
by its European neighbours via the Marshall Plan between 1948 and 1952, this
is something of a simplification of the underlying picture. Spain’s US aid in
absolute terms was roughly equivalent to the level of Marshall Plan assistance
to Germany and higher than the average quantity received by all of the 15
Marshall Plan beneficiaries. Nevertheless, there were major differences
between Spain’s US aid and the Marshall Plan assistance. First, Spain’s aid was
spread out over 14 years, while the Marshall Plan lasted only four years and
was mainly concentrated during the two first years of the programme.
Secondly, much of Spain’s aid was given in the form of concessional loans,
while most of the Marshall Plan consisted of grants. 18 The aid to Spain during
the 1950s averaged around 1% of GDP, far below the average 2.5% that
Marshall Plan recipients enjoyed over a much shorter period. US economic and
military aid to Spain between 1946 and 1975 amounted to $1.97 billion, 1.05%
of the world total. 19
18. See p. 8 of The Spanish Economic Experience: Lessons and Warnings for Latin America, by Paul Isbell
(Working Paper 20/2004, Elcano Royal Institute).
19. See the chapter by Núria Puig in España y Estados Unidos en el Siglo XX, edited by Lorenzo Delgado
and María Dolores Elizalde (Consejo Superior de Investigaciones Científicas, 2005).