- 1. GEOGRAPHY AND HISTORY DEPARTMENTTeacher: Maite Fresnillo
UNIT 8: INDUSTRIAL SPACESIndustrialization requires the presence
and exploitation of a series of elements such asraw materials and
energetic resources. Prior to begin analysing the characteristics
ofindustrial development, we are going to analyse some essential
elements involved andtheir characteristics. 1. Raw materialsThough
Spains mining sector, including the coal-mining industry, employed
only80,000 persons and was responsible for only about 1 percent of
the countrys GDP inthe late 1980s, Spain was an important producer
of minerals.Spanish mineral production was of particular
significance to the EC because Spain wasits sole producer of
mercury, natural sodium sulphate, and tantalite. Moreover,
Spainmined approximately 9 percent of all EC copper, and important
percentages ofantimony, gold and pyrite, silver, lead and
magnetite, iron ore (38 per cent) andtungsten, and fluorspar and
zinc. In addition to mining, Spain was an importantprocessor of raw
minerals, both those produced domestically and those imported
fromabroad. Although Spain was the most self-sufficient member of
the EC with regard tominerals, imports were needed to meet about 30
percent of its needs.In the mid-1980s, Spains mining industry
suffered from the depressed state of theworld minerals market, and
the production of most substances had declined. The dropin the
value of the dollar, the dominant currency in the mineral trade,
further reducedthe sectors profits, which had already been damaged
by declining sales. Spanishproduction of copper, tin, and wolfram
all declined by more than 75 percent in 1987.The production of
iron, pyrites, and fluorspar also dropped significantly in the
sameyear. Zinc, potassium salts, uranium, and lead production
remained steady during thisperiod, however.1
2. GEOGRAPHY AND HISTORY DEPARTMENT Teacher: Maite
FresnilloThese mineral resources were used in the following way: a)
Metallic minerals: Found in the sides of the Herzinian base, they
are used inbasic industries such as iron and chemistry. b)
Non-metallic minerals: Linked to Palaeozoic formations, they are
used inconstruction and chemistry. c) Industrial stones: They can
be found in different places and their main use is
inconstruction.Mineral production is not enough to supply Spanish
industry so they have to resourceto the foreign market. Some of the
products are exported but the value ofexportations is always below
that of importations.Since the entrance in the EU the mine policy
has these targets: - increase the competitiveness of interior
mining - improve environment and mines habitats - encourage
research and technical development.As a result of this policy
several mines have been closed due to their lack ofcompetitiveness.
2. EnergySpain is poor in energy resources, with the exception of
coal. Rapid industrial growthhas intensified the problems caused by
insufficient oil reserves, dwindling supplies ofeasily accessible
high-quality coal, and inadequate water for power generation.
Untilthe early 1980s, Spain depended increasingly upon imported
petroleum, and overallenergy consumption continued to grow in the
1973-79 period. Following adjustmentto a slower rate of economic
growth and to the changed energy market of the 1970s,Spanish energy
consumption declined in the early 1980s.The National Energy Plan
(PlanEnergetico Nacional--PEN), thebasic statement of official
energypolicy, was first formulated in1978. Revised in 1983 to cover
the1984-93 period, the new PENaimed at a rationalization ofenergy
consumption and areduction in Spains dependenceon imported energy.
It pressed, inaddition, for a reorganization ofthe oil industry and
for a financialreorganization of the electricityindustry. In
contrast to the 1978-87 plan, it reduced the role of nuclear
energy. 2 3. GEOGRAPHY AND HISTORY DEPARTMENT Teacher: Maite
Fresnillo2.1. Main energy sources2.1.1. CoalSpains coal reserves
are found primarily in Asturias, with smaller deposits located
nearsouth-western Seville, Cordoba, and Badajoz, and in
north-eastern Catalonia andAragon (Spanish, Aragon). Most of the
countrys lignite is located in Galicia. Domesticcoal is generally
of poor quality, and, because of the structure of Spanish deposits,
it ismore expensive than imported coal.Higher oil prices
havespurred domestic coalproduction.Annualproduction in the
early1970s amounted toabout 10 million tons ofcoal and 3 million
tons oflignite. By the mid-1980s,the industry produced 15million
tons of coal and23 million tons of ligniteannually. This higher
rateof production was insufficient to meet domestic needs because
coal had come tosupply about 25 percent of Spains needed energy,
compared with about 16 percent inthe early 1970s. About 5 million
tons of foreign coals were imported per year.Over the years, there
had been little change in patterns of coal consumption. Hardcoal,
used mainly for the generation of electricity, accounted for 65
percent of totaldemand. The steel and cement industries were the
two next-largest consumers.The main problems of coal production
are:- Some of the richest mines are exhausted or of low quality-
Many mines present problems to be exploited- Business size is
small- Demand has been reduced- With the entrance in the EU the
prices liberalisedFrom the thirteen regions in which coal is
produced the main is that of Asturias, Leonand Palencia but it can
not supply the internal demand.The main use of coal production is
for generating thermal electricity, but these centralsare not used
unless there is deficit in hydro electrical production. The problem
ofthermal centrals is that they can be highly pollutant, for
instance, creating acid rain. 3 4. GEOGRAPHY AND HISTORY
DEPARTMENTTeacher: Maite FresnilloCoal is also used in iron
industries and for concrete fabrication.In line with the energy
rationalization policies set by PEN, the government sought
toincrease the efficiency of the coalmining sector by closing down
high-cost mines andby providing financial aid for the industrys
modernization. To encourage the cementand other industries to
convert from oil to coal, the government allowed them toimport
duty-free coal. The government also made efforts to substitute the
use of oilfor coal in urban areas.2.1.2. PetroleumAlthough oil
continued to be Spains major source of energy, it had diminished
inimportance significantly since 1973. Oil consumption grew
steadily between 1973 and1979, reaching 50 million tons in that
last year, but by 1985 it had declined to 39million tons. Oil
accounted for two-thirds of the countrys primary energyrequirements
throughout the 1970s, but by the mid1980s the figure had dropped
tojust over half. In 1985 alone, Spanish industry saved 40 billion
pesetas (US$260 million)by replacing 500,00 tons of oil consumption
with coal and natural gas.In 1985 Mexico, responsible for 19.7
percent of Spains petroleum imports, was thelargest single supplier
of Spains energy needs, and in the mid-1980s Latin
Americancountries provided Spain with about one-quarter of its
imported oil. Africas share--Nigeria being the most important
supplier dropped. Middle Eastern countries provided27.4 percent in
1985 and 29.6 percent in 1987. Western Europes share rose.
Effortswere under way to lessen Spains dependence on Middle Eastern
oil and to increaseimports from Mexico.In the 1980s, imported
petroleum entered Spain via eight ports. The three largest, interms
of vessel capacity, were Algeciras (330,000 deadweight tons),
Malaga (330,000tons), and Cartagena (260,000 tons).Spain possessed
a small domesticoil production capability thatyielded only 1.6
million tons in1987. Despite a sizable explorationeffort, only a
few small fields andtwo medium-sized ones werediscovered. The
Casablanca oilfield, discovered in 1983, yielded90 percent of
Spains domestic oilproduction in 1987, but it was not large enough
to offset an overall decline in Spanishproduction. The fall in oil
prices in the 1980s further reduced the countrys
explorationefforts. 4 5. GEOGRAPHY AND HISTORY DEPARTMENTTeacher:
Maite FresnilloThe Spanish oil industry imported and refined
foreign crude petroleum; it distributedpetrochemical products
within Spain; and, in the mid-1980s, it exported about 10million
tons of finished petroleum products per year.As with some other
sectors of the Spanish economy, the domestic oil industry hadbeen
brought under state control. Distribution of petroleum products had
been in thehands of the state monopoly, Compania Arrendataria del
Monopolio de Petroleos(CAMPSA), since 1927, and large portions of
the shipping and refining system werestate owned.To rationalize the
petroleum industry and to make it able to withstand
foreigncompetition, the National Institute for Hydrocarbons
(Instituto Nacional deHidrocarburos--INH) was formed in 1981 in
order to direct CAMPSA and those parts ofthe oil, gas, and
petrochemical industry supervised by INI. By the mid-1980s, INH
wasresponsible for more than 1 percent of the Spanish GDP, and it
claimed 20,000employees. To prepare for Spains entry into the EC,
after which state monopolieswere required to be phased out, all of
INHs holdings, with the exception of the stategas company, Empresa
Nacional del Gas (ENAGAS), were placed under a new holdingcompany
in the late 1980s. The company, Repsol, which had a stock market
listing, wasgradually to allow a greater role for private capital
in the petroleum industry. By 1988Repsol had become Western Europes
seventh largest petroleum company, and itsmanagement planned to
continue to control about half of the Spanish market oncethat
market was fully opened to foreign firms in 1992. EC membership
renderedCAMPSAs future uncertain, for it would no longer be allowed
its distributionmonopoly. The Treaty of Accession that brought
Spain into the EC stipulated thatspecific amounts of nine groups of
petroleum products from foreign suppliers wouldhave access to the
Spanish market. In 1986 these products were to have a 5
percentshare of the domestic market--a share that was to increase
by 20 percent (of this 5percent) each year thereafter.2.1.3.
Natural gasIn order to reduce Spains dependence onimported oil, PEN
encouraged natural gasconsumption. Efforts to redirect the use
offuels were successful, and in the 1980s theconsumption of natural
gas increased fasterthan that of any other fuel. Total natural
gasdemand doubled between 1973 and 1984. Domestic production of
natural gas began in 1984 with the development of the
Serrablofield; two years later the Gaviota field went into
operation. In 1987 domesticproduction supplied about one-sixth of
Spains natural gas consumption, and observersanticipated that its
share might rise to as much as one-third by 1990.
Domesticproduction shortfalls were taken up by imports from Algeria
and Libya under long-term5 6. GEOGRAPHY AND HISTORY
DEPARTMENTTeacher: Maite Fresnillocontracts. In 1988 it was agreed
that Spains gradually expanding gas pipeline networkwould be
connected to the European network, and Norwegian gas was scheduled
tobegin arriving in Spain in 1992.2.1.4. Nuclear energyIt is
produced by fission but research onfusion still being carried
on.Fission produced nuclear power startedin 1975, as a consequence
of petroleumcrisis. It has increased after 1984although public
opinions opposition.Uranium is produced in Ciudad
Rodrigo(Salamanca) and Don Benito (Badajoz).It is enough to supply
the internaldemand of the product.The main application is
electricityproduction but it also has other uses such as in
medicine.The main problems of fission produced energy are:-
dependency towards foreign technology- potential security risks-
atomic waste elimination- dismantle centrals no longer in
use.2.1.5. Hydraulic energyIt is produced using the energy
generated by water in dams. When the water jumps itmoves a turbine
and this mechanic energy is transformed into electricity. It was
veryimportant from 1940 to 1972 but it was reduced later when
thermal electricity startedbeing produced.The main production is
located in the North of Spain and the Mediterranean coastwhere the
slops make easier the production of the energy. The main use is
electricityproduction.Its main benefit is the easiness to produce
it. But it has problems as well: differentproduction depending on
the water flows or the problems related to its use forwatering
agricultural spaces of for home supplies.6 7. GEOGRAPHY AND HISTORY
DEPARTMENTTeacher: Maite Fresnillo2.1.6. Alternative powersTheir
consumption has increased since the beginning of petroleum crisis.
Thanks tothem dependency has been reduced because these energies
are locally produced.Their main advantages are: - they are
inexhaustible - they are clean - they are not
concentratedgeographically - they can be used even inregions of low
consumptionSpain presents good conditions for the production of
alternative energies, anyway,there is not too developed at the
moment. The main use is produce thermal, electricalor mechanic
energy.The alternative powers used in Spain are: a) Hydraulic
mini-centrals: located in small rivers b) Wind power: used for
mechanic or electrical power c) Biomass: it uses waste products of
agriculture, livestock and forestry. Thepower is generated by
combustion. From one of the varieties, the green one,bio-fuels are
produced. d) Sun power: thermal and photovoltaic energy are
produced e) Geothermal: it uses the internal heat of earth. It is
use for heating.2.2. Electricity productionAlthough Spains
mountainous terrain would appear to be well suited to
hydroelectricpower production, the scarcity of water limited such
potential and was the principalreason for Spains heavy dependence
on thermal power. In 1986 only 27.2 percent ofthe countrys
electricity came from hydroelectric plants, while 50.6 percent came
fromconventional thermal plants, and 22.2 percent came from nuclear
plants. The mostimportant fuel for the production of electricity
was coal, which generated about 40percent of the total. In 1987 the
production of electricity amounted to 132,000 millionkilowatt
hours--about six times the amount produced in 1960 and twice
theproduction level of 1970. The total installed capacity of the
predominantly privatelyowned electrical system was about 40 gig
watts--an amount large enough to meet thecountrys needs and to
allow some exports. In the second half of the 1980s, the growthof
the demand for electrical power was less than anticipated, and
Spain had a supplyadequate to last until the mid-1990s. The Spanish
level of per capita electrical powerconsumption was among the
lowest in Western Europe, surpassing only those ofGreece and
Portugal. 7 8. GEOGRAPHY AND HISTORY DEPARTMENTTeacher: Maite
FresnilloA key element in the future of Spains electrical power
industry was the role to beassigned to nuclear power. Nuclear power
was an important factor because of scarcepetroleum reserves, the
limited potential for hydroelectric power production, and
thepresence of significant uranium deposits. The first PEN, drawn
up in 1978, emphasizedthe role that nuclear power would play in
meeting the nations ever-increasing needfor electricity. The
revised PEN of 1984 postponed the opening of the Lemoniz
NuclearPower Plant for political reasons, and it continued the
mothballing of three othernuclear plants. The government decided,
nonetheless, that if the demand forelectricity increased by more
than 3 percent, work on one of the plants might berestarted. The
new PEN also emphasized the benefits of increased natural
gasconsumption. 2.3. Energetic policyWhen the petroleum crisis
started a group of 21 countries created the InternationalEnergy
Agency in order to establish the main lines for energetic policies,
being themain points:- reduce consumption- substitute petroleum
byother powers- encourage researchEnergetic policies started late
inSpain. The Plan Nacional de laEnergia was designed to reduce
dependency towards petroleum and, at the moment,a Plan de Energas
Renovables is in force.The main lines of energetic policy are: a)
EU energetic policy: it has started in 1983 with the following
targets: a. Assure supplies and, for that, diversification is
essential b. Reduce consumption and use of non exhausting energies
c. Create an internal energetic market d. Control the negative
influence on environment b) New EPN will last until 2010 so that:
a. Consumption of gas will increase b. Non exhausting energies will
increase, and petroleum too c. Continue with nuclear power and
reduce coal c) Plan de Energas Renovables (1999-2006): The aim is
to meet some of the datain relation to non exhausting energies. 8
9. GEOGRAPHY AND HISTORY DEPARTMENTTeacher: Maite Fresnillo 3.
Spains industry 1855-19753.1. Historical development a) Beginnings
of industrialization (1855-1900)This development started later than
in other European countries. The reasons for it arerelated to the
difficult conditions: - Scarcity of some raw materials and
energetic products - Lack of entrepreneurship - Few capitals were
available - Technological backwardness - Offer of limited products
- Complicate foreign situation - Inappropriate industrial policyA
majority of industrial production wasdependent on the high tariffs
created forforeign products during the Restorationsettlement. b)
First third of the 20th century (1900-1936)It was the time of
industrial development due to:- development of coal mining, mainly
during WW1- mineral exportations- developments of second industrial
revolution- increase of national investments- public works were
developed during Primo de Riveras dictatorship- industrial
protectionism. c) Civil War and war aftermath (1936-1939)Industrial
development stopped. Industries were destroyed and due to the
autarky ofthe war aftermath industries could not get the energetic
resources required. The crisiscontinued until the fifties. d)
Between 1960 and 1975It was the period of developmentalism, due to
these factors:- liberalisation of imports- expansion of capitalism
economy- good situation of the country 9 10. GEOGRAPHY AND HISTORY
DEPARTMENT Teacher: Maite Fresnillo - low energetic prices -
Development Plans designed by the government.3.2. Industrial
productionSince 1955 the innovations of first and second industrial
revolutions had beenacquired. Thanks to that different sectors
evolved.During the second half of 19 th century the industries that
were significant were ironand cotton textiles. The first one was
located in Andalucia and the North (Asturias,Cantabria) and the
second in Catalonia.During the first third of 20th century the
leading sector were related to basic andconsumption industries: a)
Basic industries: iron, refineries, petro-chemistry were supported
by thestate. The INI was created and pushed a sector that required
stronginversions but had low profitability. These sectors were not
appropriate forprivate investments. b) Consumption equipment
industry (textile, shoe making) increased at thesame time as the
citizens life conditions. Other products such as cars andelectrical
appliances for homes developed too due to similar reasons. c)
Industrial equipment industry (machinery) did not develop too much
due tothe technological backwardness. Anyway some sectors continue
beingimportant because they counted with natural resources and they
requiredunskilled workers. 10 11. GEOGRAPHY AND HISTORY
DEPARTMENTTeacher: Maite Fresnillo3.3. Industrial structureThe
characteristic of industrial structure during the period 1855-1975
are: a) Production system acquired the characteristics of serial
fabrication since thebeginning of 20th century. It was applied in
big factories so that it was possibleto produce homogeneous
articles at low prices. There were also numeroussmall factories
working with traditional methods. b) Workers were abundant and
given that the industry did not demand skulledpeople their
situation was not regulated at the beginning. c) Size of
enterprises: there were huge contrasts:a. Small factories and
workshops: they required low investments, simpletechnology and, as
a consequence, they were not competitive. Theywere specialised in
consumption products and benefited fromprotectionism.b. Big
factories were scarce and they were mainly linked to iron
industry.They received the support of the State with the creation
of the INI. d) Technological backwardness and dependency from
foreign technology, capitaland energy. The main characteristics
were: a. Technological backwardness was provoked by protectionism
becausefactories were not forced to compete in order increase
productivity. b. Technologically dependent because there were
little attempts to renewindustries. c. Financial dependency because
national inversion was scarce. 11 12. GEOGRAPHY AND HISTORY
DEPARTMENTTeacher: Maite Fresnillo d. Energetic dependency because
there was not enough ability to exploitcoal and hydrocarbons.All in
all, Spain industrialised but due to its limits it was always
located in a peripheralposition in the world.3.4. Trends and
criteria to create industriesWhen an industry is created criteria
such as the reduction of expenses are taken intoaccount. There are
several factors. a) Traditional factors: a. Be close to raw
material and power generation b. Existence of a wide market c.
Abundant and suitable workers d. Good communication means for
distributing the products e. Capitals or ability to attract them f.
Supporting sectors, this is, other factories to create
infrastructures andequipment g. Industrial policies favourable to
industrial development.b) Industrial concentration trend:During the
period considered industries trend to concentrate near cities
because inthis way it was easier for them to obtain benefits:
complementary industries,transports, workers, workshops, equipment,
information and innovations.3.5. Industrial areas a) From the very
beginning the periphery of Spain was the leading area
forindustrialisation, including Basque Country, Catalonia and
Levante, in additionto Madrid. The reasons for that concentration
were: - Their location eased the obtaining of raw materials and
normally they were located near mines - Port infrastructures
available - Industrial regions: they were in cities where some of
them could find their own markets, as in the case of Madrid. 12 13.
GEOGRAPHY AND HISTORY DEPARTMENTTeacher: Maite FresnilloThere were
other little industries sometimes linked to traditional
agricultural productsbut without any concrete location pattern. b)
During the first third of the 20th century and Francos time
industries weredistributed to try to eliminate the disequilibrium
between regions.- fix the hegemonic situation of former industrieso
the region around Biscay was specialised in basic industrieso the
Mediterranean region was more diversified, with light industriesand
small industrieso Madrid was an area highly diversified.- creation
of new industrial spaces: there were related to communicationaxis,
such as the Ebro and Mediterranean, Galicias coast and
OccidentalAndalusia, thanks to the state policy; or very located
places devoted to aconcrete production, development hubs.- Rest of
areas of Spain counted with scarce or none industries, with
theexception of provincial capitals linked to traditional
productions.3.6. Industrial policyIn this period the main
industrial policy was the interventionism of State in industry.The
measures taken were:a) Protectionist policy: Spanish industry did
not have foreign competence becauseforeign products were not
competitive. This measure was not good becauseeven if it provoked
the development of industries encouraged by the goodperspectives at
state level, it impeded the technical modernization.b) Creation of
public industries in sectors that did not attract private capitals.
13 14. GEOGRAPHY AND HISTORY DEPARTMENT Teacher: Maite Fresnilloc)
Measures to try to reduce the differences between different
regions. These measures were put together in the Development Plans
(1964-1975).In order to stimulate industries they realised a series
of actions: - Promotion and development hubs were created following
the French model. There were created to minimize the differences
between regions, to develop those that had fallen behind.
Industrial development hubs were created in cities with a certain
industrial base (Corua, Vigo, Seville, Valladolid, Zaragoza,
Granada, Cordoba, Oviedo, Logroo and Villagarcia de Arosa).
Promotion hubs were targeted to underdeveloped regions. The result
was not as good as expected because they did not generate so many
jobs as expected and their influence in other industries was
limited. - Especial treatment to some industries in concrete areas:
regions with priority to create industries, in cases of areas
appropriated for certain activities, industrial estates or parks
distributed in the whole territory and big areas for industrial
development created in the Third Development Plan. In those they
try to create development axes, with good communications linking
cities and industrial nucleus.4. Industrial crisis and
restructuring4.1. Industrial crisisThe crisis affected all
industrial countries since 1975. It was very negative for Spainthat
lacked of a strong industry.Reasons for the crisis. There were
exterior and interior.a) Exterior causes: a. Energy became more
expensive, mainly due to the increase ofpetroleum prices. b. The
former technological cycle was exhaustedi. Technologies were
delayed confronted with the new ones such as microelectronics,
computers, telecommunications ii. New economic sectors were above
the previous ones.iii. New flexible production systems
(decentralised, in small factories) c. New characteristics of the
demand, which made necessarydiversification and continuous reforms.
d. Globalization of economy and competence of the New
IndustrialisedStates.b) Interior causes:14 15. GEOGRAPHY AND
HISTORY DEPARTMENT Teacher: Maite Fresnillo a. Inadequacy of
structures of Spanish industries: not very specialised,high
energetic consumption, scarce modernization, dependency of
theexterior, abundant debts, lack of self-financing. b. Historical
situation: doubts about the future during the transition,
afterFrancos death.Consequences of the crisisAs a consequence of
the crisis many industries closed down, production reduced,results
reduced and debts and unemployment increased. The amount of
industry inGDP was reduced and the peripheral role of Spain in
world economy was reinforced.4.2. Policy and crisis confronted:
industrial restructuringTo answer to the crisis the Society for
Development and Economic Cooperation wascreated in 1975. The
restructuring had two parts: the rationalization and
re-industrialization. State gave aids of different kinds:
financial, fiscal and labour. a) Industrial rationalization or
restructuring: in the case of industries that wouldre-adapt to the
new characteristics of the market reforms were done. The
mainmeasures were:a. Adjust offer and demand, eliminating over
productionb. Regulation of staffc. Specialise in products of the
highest demandd. Application of new organizational and management
systems. b) Re-industrialization It affected two aspects: -
Technological modernization in sectors that could develop in the
future. - Introduction of new activities with better future
perspectives. For that Areas of Urgent Re-industrialization were
created. 15 16. GEOGRAPHY AND HISTORY DEPARTMENT Teacher: Maite
FresnilloAs a consequence areas that were very specialised had a
diversification ofindustries. Anyway, they were deficiencies too:
creation of fewer work places thanexpected, the majority of the
economic aids went to big industries and thedisequilibrium between
regions enlarged. 5. Spains industry today5.1. Third industrial
revolution and industrial recoveryAlthough industrial restructuring
is not completely finished, some sectors are alreadyexperiencing
the changes of a new industrial revolution.Changes of the third
industrial revolutionThe basis of this phase of industrialization
is innovation,this is, the use of new technologies in the
productiveprocess. The new technologies are those of theinformation
and microelectronic. a) Changes in industrial
productionTechnological revolution has affected sectors linked
tohigh technology: - Information technology: telecommunications,
computers - Automation: robots, assisted design - Set up tools:
equipment using abundant information b) Changes in industrial
structure- Changes in the way of production: decentralization
(factories with different plants, subcontracting, formation of
enterprises nets) and flexibility of the production.- Changes in
the size of the factories, they tend to be smaller.- Changes in the
staff because they must be skilled but due to automatic processes
other ways of hiring personal have appeared, such as temporary,
free-lance, and others.- Outsourcing (terciarizacion) of the
industry c) Changes in setting up industries- to reduce costs
factories move to places where they can obtain higher benefits- as
they demand qualified works and a lot of administrative work, they
can be concentrated in areas with enough equipments. d) Changes in
industrial policy 16 17. GEOGRAPHY AND HISTORY DEPARTMENTTeacher:
Maite Fresnillo - limit of State intervention and open to foreign
influence inside the globalization trend - endogenous
industrialization is supported - environmental awarenessInfluence
of third industrial revolution in SpainThanks to the third
industrial revolution developed countries are recovering and as
aconsequence factories and work opportunities have increased.In
Spain this influence started in 1985 that only stopped in
1990-1994, as in othercountries. Since that moment it has evolved
full of dynamism. All in all, problems havenot been completely
eradicated and Spanish industry continues having difficulties
inproductivity, structure and the link to the land and
environment.5.2. Industrial production: sector structure.The
industrial sectors involved in the restructuring process still
being important. In themost dynamic there is foreign capital and
sectors related to technology are a bitbackward.5.2.1. Traditional
sectors in restructuring processThey have been negatively affected
by:- reduction in demand- lack of competitiveness- European
policies for limiting production and subventionsSectors affected
are: a) Basic metallurgy and metallic transformation a. Iron
industry: It has been united to other European factories. The
results have been reduction of costs, diversification of production
and improvement of quality. In Mediterranean, Basque Country and
Asturias. b. Industries of metallic transformation: they make
machines of any kind and are located in the triangle
Barcelona-Basque Country-Madrid. b) Production of electrical
equipment for houses: it is being changed in order to specialise
the production, industrial concentration and enlarge and diversify
market. As a result many factories have closed down and workers
situation has been regularised. c) Shipbuilding: it is concentrated
in Galicia, Cantabria, Basque Country and Andalusia. It has been
limited and it tends to specialise, for instance, in repairing. d)
Leather and shoemaking: it is important in Catalonia and Valencia.
It has introduced new technologies and for that foreign capitals
have been used. On 17 18. GEOGRAPHY AND HISTORY DEPARTMENT Teacher:
Maite Fresnillo the other hand, there are a lot of small factories.
It must compete with foreign cheap products so that they
concentrate in quality and design.5.2.2. Dynamic industrial
sectorsThey will have plenty of resources in the future due to: -
high productivity and specialization - healthy enterprise structure
- demand assuredIn this sector foreign investments are frequent. a)
Car industry: it has suffered a strong restructuration because it
wastechnologically backwards. It has improved but it needs
technologicalinnovations. b) Chemistry: It is one of the basic
industries in Spain, but its situation is not goodbecause it
depends on foreign capitals, it has to face strong competence and
ithas scarce investigation level. It has two sub-sectors: a.
Petro-chemistry or basic chemistry, normally related to refine b.
Transformation chemistry, in small factories: pharmacy perfumes,
painting materials, paper. Exports have increased. c) Sector of
agriculture aliments: it is small and disperse but multinationals
havean important role in it. Their aim is to increase sales in the
interior market anddevelop the export of transformed products. d)
Building industry: it is subject to many changes. During the last
times is quite ina crisis.5.2.3. Leading industrial sectors.High
technologies have reached to Spain late and they have been faced
with severalproblems: a) Dependency towards foreign countries for
investigation and technology b) Factories are small, with few
capacity for competitiveness c) Work force and studies have not
been appropriated: high technologies are concentrated in innovative
regions, where technological parks are created. These areas have
some particular characteristics:a. Concentration of innovation and
research centresb. Located in specific areas, are not very big but
well linked with theenvironment around and telecommunicationsc.
Located near metropolis or in medium cities with good
qualityenvironment and services 18 19. GEOGRAPHY AND HISTORY
DEPARTMENTTeacher: Maite Fresnillo d. Integrated with the region in
which they are, they demand services andskilled workers.The results
of these industries are: - They are attractive enough to attract
other factories in areas known as parks. They can exercise their
attraction over multinationals and they tend to be successful due
to the high level of technology used. - Their influence in areas
around is not clear because in many cases they are linked to
foreign multinationals, being their direct impact in the region
more limited. - Disequilibrium is bigger than before because they
are concentrated in certain areas: Madrid, Catalonia, Basque
Country, Valencia and Andalusia, near big cities or in dynamic
axes.5.3. Present structure and problems of Spanish industrySpanish
industry has some structural problems and as a result it is not
well adapted tothe new technological cycles. a) Factories size is
not appropriate: a majority of them are small (less than 50workers)
or medium (from 51 to 500). They can adapt to the changes and
theconflicts are scarce. Their problem is that they are not
competitive becausethey are too small and they can not make great
investments in research andmodernization. In addition to this,
until recently they have been left apart fromthe industrial policy.
b) Research is small because the investments in this concept are
reduced. I+Dinvestments are concentrated in some sectors that are
the most dynamic:electronics, computers, pharmacy, and chemistry.
Anyway this has beenchanged during the last years in order to
create more competitive factories. c) Technological backwardness
and dependency: There is little technology inSpain and it tends to
be imported and this is linked to the limited investmentsin I+D. As
a result, quality and productivity are limited and they are
notcompetitive, leaving Spain in a peripheral situation.5.4. Modern
trends and factors for industrial location.They have been changed
since the 1980s decade but they have maintained thetendency for
industrial concentration.5.4.1. Present factorsThe classic ones
have lost importance due to the industrial crisis and due to
theinfluence of the third industrial revolution. The new factors
are: - Natural resources availability is not as important as
before: communications have improved, some means of transport such
as ships are cheaper and thanks to new technologies there are
synthetic raw materials.19 20. GEOGRAPHY AND HISTORY DEPARTMENT
Teacher: Maite Fresnillo - Market size has enlarged - Means of
transport and communications are better - Work force is an
essential element, mainly in factories requiring qualified
personnel - Innovation and ability for getting access to
communication have become essential elements.5.4.2. Present trends
for factory location: expansion and concentrationDue to the changes
mentioned above, trends to locate industries have changed: it is
ageneral trend to locate industries in peripheral spaces, but the
regions moredeveloped continue exercising attraction. a) Industries
were limited to peripheral region due to the following factors: a.
Great concentrations create problems because the spaces are full
and this makes more expensive infrastructures and conflicts are
more common, in addition to damage environment. Due to that they
tend to divert them to less conflictive areas. b. Technological
improvements c. New capitalist strategies d. Endogenous
industrialization b) Central spaces continue being attractive
because they can offer infrastructuresthat are required by some
technological sectors.5.5. Industrial spaces and disequilibriumIn
Spain, industrial location presents disequilibrium between regions.
There are verydifferent situations, with developed, developing and
areas in crisis, or withindustrialised and non industrialised
areas. The disequilibrium is more important in themost dynamic
sectors, because they tend to locate in the most developed
regions.The irregular distribution of industries influences in
other disequilibriums linked tothem: - population distribution -
richness - infrastructures, equipment andsocial services -
political importance.This last factor can be negative for
scarcelydeveloped regions because due to thisindustrial development
can be a key factorin industrial policies. 20 21. GEOGRAPHY AND
HISTORY DEPARTMENT Teacher: Maite FresnilloTaking into account
industrial location, the following regions can be
distinguished:5.5.1. Developed regionsThere are central spaces of
metropolis, mainly Madrid and Barcelona. In the presentdevelopment
trend we can find: - traditional sectors are in decay or have been
restructured - industrial activity has recovered because many
factories and firms havetheir offices or part of their factories in
these big citiesIndustries are in a process of tertiarization and
the result of that is the creation ofindustrial or enterprises
parks.5.5.2. Areas and axes in developmentThere are the result of
an endogenous industrialization. The following ones can befound: a)
Around metropolis decreasing or restructuring industries, but there
are others in progress: a. Industries coming from city centres have
been established here. Thereare traditional industries that have
found in these areas a cheaper spaceto develop. Normally they form
industrial polygons with goodcommunications with the city. b.
Innovative factories or technological parks. b) Around cities:
there are a space in between the city and the agricultural
spacearound, an area very attractive for industrial development.
Factories tend to besmall, with scarce capital: intensive
productions doing non skilled works,factories subsidiary of others.
The main kind is that of polygons of industrialnaves that normally
add to their small size some lacks in equipment orinfrastructures.
c) Industrial development axes: they are located in the main
communication nets: a. Ebros valley and Mediterranean
(Girona-Cartagena). Motorways link the South of Europe with this
area. They have attracted state and international multinationals.
These areas have traditional industries and there is a connexion
with the agrarian regions around so sometimes the industries are
spread in the territory. b. Some axes have developed locally: the
net around Madrid expands to the provinces of Castela-Mancha and
there are other secondary axes along some main routes
(Tordesillas-Valladolid-Palencia). d) Some rural areas have become
the location for small companies and inversions,with simple
technology and demanding non skilled work force. The mostcommon are
traditional workshops. Anyway, sometimes innovative industries 21
22. GEOGRAPHY AND HISTORY DEPARTMENT Teacher: Maite Fresnillo may
appear thanks to the solidarity between factories or animated by
administrative advantages.5.5.3.Regions and axes in crisisThere are
some regions such as Asturias, Cantabria or some specific places.
BasqueCountry was included in this group for a time but nowadays
its industry has recovered.The characteristics of these regions
are: - There are regions specialised in sectors in crisis. Big
factories are commonwhile medium and small have a smaller
proportion and in the cases theyexist, they are linked to the big
ones. - The preparation for the work market is medium or small:
conflicts arefrequent and the presence of unions is permanent. -
Environment has been affected for long.These regions have been
affected by a deindustrialization process and as aconsequence are
involved in a demographic crisis and their position is peripheral
asdecision centres or industrial areas.Some of them have been
recovered, such in the case of the Basque Country.5.5.4.Regions of
inducted or scarce industryAreas of inducted industrialization are
Aragon, Castile and Leon and Andalusia. Theybenefited from the
decentralization policy of the 1960s and at the moment they
havedeveloped industrial areas.Areas of scarce industry are
Castile-Mancha, Extremadura, Baleares and Canaryislands. Their
location is not competitive. In them important industries are
notfrequent and sectors are traditional producing low value things.
Castile-Mancha beginsto be the exception to the group thanks to its
link with Madrid.5.6. Industrial environmental problemsIndustrial
problems have an influence on environment if the following aspects
aretaken into account: a) Natural resources are over exploited b)
Some industries pollute the environment c) Industries deteriorate
natural landscapes statically.5.7. Todays industrial policy 22 23.
GEOGRAPHY AND HISTORY DEPARTMENT Teacher: Maite FresnilloNowadays
it is characteristic of Spains industry the reduction of the role
of the stateand the assumption of some measures to correct
structure, location andenvironmental problems.5.7.1. Reduction of
States interventionThe most characteristic forms of State
intervention were: a) Openness to the exterior: it has been
possible thanks to the entrance in the EUand due to world
globalization.a. EU: Spanish protectionism was left apart,
increasing competitiveness; inaddition to this, the tariffs of the
EU are smallb. Imports and exports have developed at entering the
world net. Foreigncapitals have been inverted in the most dynamic
sectors. b) Companies of high profitability have become private.
SEPI has been createdinstead of INI to try to make of these
industries profitable and able to competein a global world.5.7.2.
Policies to solve the structural problemsThey have followed the
same policy of the EU and the aim is to increase Spanishproducts
competitively. The main points are: a) Since 1991 re-structuring
has improved with the aid of European funds b) Increase the
competence of companies, mainly by supporting small andmedium
industries. c) Develop research d) Reduce technological
dependency5.7.3. Policy to correct regional disequilibriumUntil
recently interest was addressed to some sectors, mainly towards the
big onesthat were in crisis, forgetting other regions. Nowadays
there are two main areas ofaction to correct those problems: a)
Policies for promoting industriesThey are designed to take into
account any kind of sector. The main objective is tocreate
competitive industries. The activities designed for this purpose
are: - Law for Incentivising Industry 1985. It helps not only to
industries but alsoto any other activity that can reduce the
differences between regions, suchas some services, touristy
activities and others. - Regional Development agencies: they
coordinate activities to supportindustries in Autonomous Regions.
Their capital is public and they stressactivities including
technologies and medium and small companies. 23 24. GEOGRAPHY AND
HISTORY DEPARTMENTTeacher: Maite Fresnillo b) Policy of endogenous
industrializationThey try to develop the potentialities of each
region. The bases of this policy are: - micro-planning: more help
of the regional governments - support for medium and small
companies - promote innovation: to achieve these purposes there are
two kinds of organizations: o Societies for developing industries o
Promote industrial districts5.7.4. Environmental policiesAfter the
70s there is a general trend against the environmental problems
created byindustries. The main activities for correcting them are:
a) Sustainability as long as use of resources areconcerned b) About
pollution: a. Protect spaces and soils b. Environmental impact must
be studied inadvance c. Promote research to create green
orecological industries d. Corrective measures such as analysis of
Environmental Advisories c) Referring to the aesthetical value of
landscape, renew areas formerly used forindustries that nowadays
are out of use.6. Industrial spaces in the Basque CountryIn the
Basque Country industry and tertiary sector have a notorious
importance.6.1.Raw materials and energyThe most important areiron
from mines andstones. Ironwasessential forthedevelopment ofindustry
and in thecategory stones silica,ofita, lime, marble andslate.Other
raw 24 25. GEOGRAPHY AND HISTORY DEPARTMENT Teacher: Maite
Fresnillomaterial is wood from the forests, in a time used for iron
elaboration and nowadayspresent in paper industry.As long as energy
sources are concerned, the Basque Country is dependent for it
doesnot produce energetic minerals and hydroelectricity is not
enough to supply all thedemand, the same as alternative energies.
To face these problems a new energeticplan has been designed.6.2.
Basque industry until 1975 crisis a) Beginning of
industrialisationIt started quite early, at least earlier than in
other regions of Spain. Several are thefactors that made possible
this development:- skilled work force trained in hand work-
commercial bourgeoisie- increase in population resulting in
abundant work force and enlargement of markets for the
productsDespite these factors, there were different situations: -
Biscay: Industrialization started during the last quart of the 19
th century. The main reason for this development was the existence
of iron mines appropriate for the production of steel. In 1868
thanks to some mine Laws connections with Britain started to export
Biscayan iron. Thanks to this trade capitals piled and it was
possible to invest in creating more industries and a bank that
could help to develop the region. Production is based on iron, and
metallic transformations. - Guipuzcoa: It started in the second
years of the 19 th century thanks to the entrepreneurship of the
bourgeoisie. New sectors and productions were introduced and for
that foreign workers came. Production was diversified and it was
spread along different valleys. - Alava and Navarre: It started
later, at the end of 19 th century and beginning of the 20th
century. In Vitoria metallurgic and agricultural industries were
created but, in general, industry was traditional. In Continental
Basque Country the traditional sector included shoe making and
transformation of agricultural and fishing products. Scarcely were
modern industries created in these areas. b) First third of the
20th century:Basque industry was influenced by the international
situation, with moments ofexpansion (WW1) and moments of
backwardness (1929 crisis). c) Civil War and aftermath (1936-1959)
25 26. GEOGRAPHY AND HISTORY DEPARTMENTTeacher: Maite
FresnilloIndustrialisation process was stopped due to: -
destructions during war operations - limits to importation of raw
materials and energy - protectionist policy that eliminated any
attempt of modernization.Thanks to protectionism several factories
were created but their production was notappropriate. d)
Development (1960-1975)Biscay and Guipuzcoa experienced a huge
increase whereas Alava and Navarre startedtheir industrialization
process. - Biscay: the main industrial concentration was settled
around in Bilbao, around the outlet, in the left margin (Baracaldo,
Sestao and Trapaga). Heavy industry was concentrated and so were
the urban concentrations, expanding to other areas of the Ibaizabal
valley (Basauri and Galdacano and Duranguesado). From there it
expanded to Guipuzcoa: Donostialdea, Deva, Urola and Oria valleys.
- Guipuzcoa: Industries concentrated in Deva, Urola and Oria
valleys and the last one was connected with San Sebastian area. -
Alava and Navarre: they started their development in this moment,
thanks to local and central administration that backed the project
(cheap soils, fiscal advantages, infrastructures). - Continental
Basque Country: the industrialization was more limited and there
were huge differences between the coast and the interior. The area
known as BAB (Bayonne, Anglet, and Biarritz) is the centre of that
economy and third sector is more important than industry.6.3.
Crisis and restructuring6.3.1. Problems and consequencesThe causes
of the 1975 crisis were: - increase of power prices (petroleum) -
apparition of new sectors linked to the technologies of third
industrialrevolution - competition of recently industrialised
states to traditional industry becausetheir salaries were lowerThe
crisis affected seriously Biscay and Guipuzcoa because industry had
an importantrole in them.The consequences of the crisis were:26 27.
GEOGRAPHY AND HISTORY DEPARTMENTTeacher: Maite Fresnillo -
factories closed down or they reduced their workforce and were
restructured - reduction of the importance of industry in the GDP -
unemployment - reduction of family income - reduction of
investments - deindustrialization - Basque Countrys industry lost
weight in the Spanish industrial system.6.3.2. Policy for
restructuring industryPolicies for confronting the crisis were put
into practice with a double objective:restructuring and
reindustrialization. a) Restructuring: it started in 1982 to adapt
industries to the new technologicalcircle, management, production
and improvement of jobs.- States aid was directed to iron industry
but the results were not theexpected. Ten years later new
programmes were designed.- Basque Government added other
complementary measures: aids forfactories in difficulty in order to
improve management and renew theprocess for the creation of new
industries. These initiatives were the oneshaving the best results.
b) Reindustrialization or policies for support industries: They
were concentratedin space policies to promote industries and the
modernization of others. Themost important were the policies to
prepare land for industries using ZUR(Zones of urgent
reindustrialization) and GBI (regions in crisis).- lands for
industry allowed the creation of small and medium factories
inindustrial polygons or technological parks (Zamudio).- Area of
urgent reindustrialization in the Nervion: they were aimed
atpromoting services, chemistry, and metallurgy of transformation.-
ZUR affected to industries in crisis. The money used was limited so
mediumand small industries were left apart. The investments were
conducted toplastic, chemistry and machinery.Other policies were
aimed at modernizing the industries or making them morecompetitive.
In many cases they were conducted to new technologies or
innovativeproductions.6.3.3. Territorial impact of the crisisThe
influence of the crisis was not equal in all the Basque
territories. In addition to this,industry initiated its recovery
from 1994 and on.27 28. GEOGRAPHY AND HISTORY DEPARTMENT Teacher:
Maite Fresnillo - Biscay: it was the most affected by the crisis.
The big Bilbao lost part of its influence and new axes appeared
(Plencia-Mungia, Txorierdis corridor). - Guipuzcoa: the
restructuring reached different areas because industry was spread.
The negative consequences were important. The Deva valley is the
region where more modernising programmes have been put into work. -
Alava: restructuring was not dramatic because the development of
the region was reduced. It was centred in Llodio, Amurrio and
Gasteiz. Nowadays it is one of the areas in development, at once
with Navarre, because projects coming from the coast are developed
in this region.6.4. Todays situationThe characteristics are: -
production based on traditional activities (metal) - structure
based on medium and small industries - I+D+I
(investment-development-innovation) has managed to get a goodlevel,
higher than in Spain - qualified work force, recycled in many
enterprises - polarised localization and disequilibrium among zones
- environmental problems - dynamic industrial policy6.4.1.
Industrial productionThe most important is metal and, in a
secondary level, construction, materials fortransports, plastic and
electrical materials. This is, it is specialised in two sectors: -
Traditional activities: their expansion is limited for they use
traditional techniques. To be competitive they need to produce at
low cost but they are not competitive. - Equipment industries
require technology and intermediaries.The possibilities offered by
new technologies are not well used. Some sectors have animportant
added value and they have developed quickly but traditional sectors
musttake advantage of renewal opportunities.6.4.2. Industrial
structure a) The size of the factories is small (less than 50
workers). Due to this it is moredifficult to compete, get money
loans, modernize, investigate and open tointernational competition.
In many cases they depend on foreign decisioncentres because
sometimes they are branches of multinationals. But the sizecan be
sometimes an advantage because in this way they can adapt to
changeseasier. Other important element is that the small size makes
possible thecooperation between factories. In the Basque Country
there are clusters, this 28 29. GEOGRAPHY AND HISTORY
DEPARTMENTTeacher: Maite Fresnillo is, groups of business of the
same branch that, in this way, aim at being more competitive. b)
Activities based on research, development and technological
innovation aremore important in the Basque Country than in other
regions. This is the resultof a series of factors:- Basque net of
technology in the Regional Plan that puts special stress on
theneeds of the factories and the National Plan has an active role
in them.- Special interest devoted to technological parks-
Availability of technological centres, linked to the demands of
thosebusinesses. c) Work force: training and education are linked
to the needs of the factories andworkers of factories involved in a
process of restructuring have been recycled.6.4.3.Industrial
localizationThere is certain resistance to changing the patterns
for locating industries. In generalthey still being the same that
were determinant in the 70s decade.Regionally, there is an inverted
triangle which three vertices are the three provincialcapitals, and
there is a contrast between the two coastal and the interior.
Bilbao andSan Sebastian are linked through a corridor (it crosses
the area of Durango and theDeva valley) and other corridor of
smaller density following the coast. On the contrary,there is not a
clear link with Vitoria.The Biscayan model is polarised, around the
Big Bilbao, the case of Alava is macro-cephalic (Vitoria) and in
Guipuzcoa the distribution is more balanced. In the
threeterritories a majority of the industries and services are
centred on the capital cities andthe links between industries are
bigger each time.Alava and Navarre are developing their industries.
There are very dynamic and theyare involved in a process of change,
linked to European and Spanish development axes.The Atlantic axis
has lost weight in favour of the Ebro. In this strategic location
theBasque Country is in a favourable position: a lot of industrial
projects come from theAtlantic area but due to the high prices of
soil and its scarcity they find new locationsin this corridor. In
addition to this, infrastructure and communications are good in
thisregion, the same as life-quality. Due to all these reasons the
Southern region hasknown an important development.29 30. GEOGRAPHY
AND HISTORY DEPARTMENT Teacher: Maite Fresnillo6.4.4.Environmental
problemsThe main problems are:- pollution of atmosphere, water and
soils- rubbish generation and their treatment- industrial
waste6.4.5. Industrial policySeveral measures have been taken in
order to solve the problems in the fields ofstructure, space and
environment.a) Problems in production and structure: there are six
lines: investment, innovation, international openness, knowledge,
quality and cooperation. The main activities are:a. Development of
new products, mainly in new sectors, such astechnologies and
information.b. Aids to medium and small factories to modernize and
foster cooperativeattitudes that can be basic for increasing
quality, improving30 31. GEOGRAPHY AND HISTORY DEPARTMENTTeacher:
Maite Fresnillomanagement and becoming more competitive. In this
order clusters areessential c. Improve research and development
(I+D) to prepare companies to becompetitive internationally d.
Support workers recycling in restructured companies.b) Policies
related to disequilibrium between regions: a. Support the links
between regions and develop industrial projects to develop
depressed areas, by creating polygons and medium industries. b.
Special attention to regions in crisis, such as the Bilbao outlet
or Pasajess port. c. Policies to control environmental problems,
controlling air, water and soils situation and controlling waste.
There are several policies for recycling, such as those of Altos
Hornos. In other cases degraded areas are being reconverted for
other uses such as leisure centres, as is the case in some areas in
Guipuzcoa. 31 32. GEOGRAPHY AND HISTORY DEPARTMENTTeacher: Maite
Fresnillomanagement and becoming more competitive. In this order
clusters areessential c. Improve research and development (I+D) to
prepare companies to becompetitive internationally d. Support
workers recycling in restructured companies.b) Policies related to
disequilibrium between regions: a. Support the links between
regions and develop industrial projects to develop depressed areas,
by creating polygons and medium industries. b. Special attention to
regions in crisis, such as the Bilbao outlet or Pasajess port. c.
Policies to control environmental problems, controlling air, water
and soils situation and controlling waste. There are several
policies for recycling, such as those of Altos Hornos. In other
cases degraded areas are being reconverted for other uses such as
leisure centres, as is the case in some areas in Guipuzcoa. 31 33.
GEOGRAPHY AND HISTORY DEPARTMENTTeacher: Maite Fresnillomanagement
and becoming more competitive. In this order clusters areessential
c. Improve research and development (I+D) to prepare companies to
becompetitive internationally d. Support workers recycling in
restructured companies.b) Policies related to disequilibrium
between regions: a. Support the links between regions and develop
industrial projects to develop depressed areas, by creating
polygons and medium industries. b. Special attention to regions in
crisis, such as the Bilbao outlet or Pasajess port. c. Policies to
control environmental problems, controlling air, water and soils
situation and controlling waste. There are several policies for
recycling, such as those of Altos Hornos. In other cases degraded
areas are being reconverted for other uses such as leisure centres,
as is the case in some areas in Guipuzcoa. 31