Neutrality 1939-45

• Following the end of the Civil War, Franco appeared to have a close relationship with Nazi Germany and Fascist Italy. However, Franco did not want to be drawn into WW2. In June 1940, Franco wrote a letter to Hitler stating his intention for Spain to remain neutral.
• By October 1940, the balance of war had shifted to be in Germany's favour. As a result, Franco met with Hitler on 23rd October 1940 to discuss Spain's entry into the war. During the meeting, Franco agreed to enter the war on the side of Hitler and Mussolini, in return for Morocco to be passed to Spanish control from France. However Mussolini had also demanded territory within Morocco, meaning Hitler wasn't willing to meet Franco's demands. This meant Spain remained neutral.
• Franco's decision to stay out of the war allowed him to focus on rebuilding Spain. Indeed, one of his reasons for staying neutral was to consolidate his powers in Spain. He didn't want to risk being drawn into a war that could further weaken the Spanish economy and result in the collapse of his 'new state'.
• Franco's response to WW2 was partly due to the domestic political situation as he had to satisfy different groups that supported his regime: the Monarchists wanted to side with Britain as the Spanish royal family had links with the British monarchy, whereas the Falangists were ideologically drawn to supporting the Nazis. Neutrality allowed Franco to retain the support of both groups, helping to maintain a stable base of support.
• Spanish neutrality initially favoured the Axis powers. Franco provided Germany with raw materials useful for its war effort and allowed Spanish people to work in German factories. German shipping and submarines were also allowed to use Spanish ports.
• In 1939, Franco had asserted that Spain was 'non-belligerent', to say Spain was not fighting in the war.
• In 1941, Franco redefined Spain's position, stating Spain was now 'morally belligerent'. The change in policy was due to Germany's attack on the Soviet Union. Franco, who despised communism, offered Spanish manpower to help the German war effort. He authorised the establishment of the Blue Division, which was 18000 volunteers who fought with the German army. Franco ensured that these forces were sent to fight on the Eastern Front against the Soviet Union and weren't to fight against the Allied forces, as he didn't want Britain to declare war on Spain.
• After October 1941, Franco also collaborated with the Nazis in intelligence gathering, to aid the Nazis' spy network against the Allies.
• Franco's perception of the war changed again late in 1941. The USA's decision to enter the war convinced Franco that Hitler could no longer win the war. Initially, Franco hoped the Nazi regime would survive and therefore continued to support the Nazi's war effort. However, when it was clear the Axis forces were losing in the war against the Soviet Union, Franco ordered the withdrawal of the Blue Division.
• From 1943, Franco adopted the policy of 'vigilant neutrality', based on the assumption the Allies would win the war.
• In 1944, Franco was forced to end his support for the Germans as the USA had initiated oil sanctions against Spain, causing the economy to be hit hard, which led to domestic unrest. Franco entered negotiations with the USA/Britain and agreed to stop providing support for Germany in return for an end to the oil embargo. Franco also agreed to stop supplying Germans with wolfram, an important mineral used in explosions, and to expel German spies from Spain. Although, Franco continued to provide Germany with intelligence information.
• Franco's policy during WW2 was pragmatic. He was prepared to enter the war on his own terms only and only tended to side with the Germans while they appeared to be winning. He also tried to avoid alienating the Allies. Franco focused on the domestic impact of the war, although he wasn't convinced his regime would survive the war. So much so, that he devised an escape plan to seek sanctuary in Portugal.