National Institute of Industry

The National Institute of Industry (INI) was a Spanish state entity, created as an institutional support to promote the development of industry in Spain. Between the years 1941 and 1980 it was in fact the largest and most important business group in Spain. The INI disappeared in 1995 and its functions were assumed by the State Company of Industrial Participations (SEPI).

During its existence, the large companies that were established at the initiative of the INI were SEAT, ENDESA, ENSIDESA and many others dedicated especially to the production of iron, steel and aluminum, and also to the petrochemical industry.

History

Creation

Image of the Pegaso II truck, launched in 1951, by the company ENASA, belonging to the INI.

Founded by Juan Antonio Suanzes Fernández during the period of Francoist autarchy (1939-59) in a law of September 25, 1941, with the aim of promoting the creation of new industrial companies within an autarkic vision of the economy:

Article 1 of its founding law:

• "To promote and finance, in the service of the Nation, the creation and resurgence of our industries, especially those which are proposed as the main purpose of solving the problems imposed by the demands of the defense of the country or which are directed to the development of our economic autarchy".

For its creation, the Italian model of the IRI was followed. The first actions ended in failure (Adaro, oil slate), but in the long run it became the largest industrial corporation in Spain.

Between 1939 and 1941, economic policy had tended to privilege vertical Unions, while at the same time granting an even greater role to private entrepreneurship in reconstruction. For the historian Stanley Payne, the dismissal of the union leader Gerardo Salvador Merino, together with the increase in military influence, encouraged the formation of this body that would directly develop state capitalism.

The INI was created to rebuild and give impetus to the Spanish economy from a very particular vision of the economy, and was in charge of channeling and starting up the large investments required for the industrialization of the country, to meet the needs of the national defense and to finance large industrial projects.

The main criticisms that can be made of his performance during his early years are the following:

• His intervention was often guided by political criteria.
• In a situation of shortage of financial resources, the key objectives focused on maximizing the amount produced rather than improving profitability.
• The production costs and their prices moved far above those existing in international markets, with very little competition capacity and detracting efficiency from the Spanish economic system.
• Their companies enjoyed great advantages in competition with the private sector, with fiscal, tariff, exchange and financial incentives.

Despite all its inefficiencies and strategic errors, the INI had an undoubted and decisive positive effect in the transition from the underdeveloped Spain and fundamentally primary economy of the 40s to the thriving and outsourcing from the 70's; but with the opening of the Spanish economy to international trade and especially to the European Economic Community, the INI lost all meaning and its companies were privatized throughout the 1980s.

The Sunset

In 1992, the INI was authorized to establish a Public Limited Company to which the Institute would contribute all of its shares in the capital of the companies in which it still participated. The new Public Limited Company was incorporated on July 4 of the same year, under the name of TENEO. It is currently called Sociedad Estatal de Participaciones Industriales (SEPI) and has disposed of practically all its industrial holdings, except for a few cases such as Hunosa, or RTVE.

INI companies

The INI was established as an industrial and financial group on which many companies depended. Upon its creation, all the securities of the State were transferred to the Institute and it was initially endowed with fifty million pesetas. Some of the companies that belonged to the INI were:

The INI also integrated other originally private companies, such as Iberia, Aviaco or CASA, and especially large industries in difficulties, such as Uninsa, Hunosa, Altos Hornos del Mediterráneo, Hijos de J. Barreras or ASTANO. However, the monopolies recognized by law to the State, such as CAMPSA, Renfe, Telefónica or Tabacalera, were never part of the INI.

Presidents