Spain also was still recovering from its civil war, and Franco knew his armed forces would not be able to defend the Canary Islands and Spanish Morocco from a British attack.
American pressure in 1944 for Spain to stop tungsten exports to Germany and to withdraw the Blue Division led to an oil embargo which forced Franco to yield.
After Allied victories in North Africa in summer 1942, Franco changed tack again, replacing Serrano Suñer with pro-British Francisco Gómez-Jordana Sousa in September.
Indeed, in June 1940, after the Fall of France, the Spanish Ambassador to Berlin had presented a memorandum in which Franco declared he was "ready under certain conditions to enter the war on the side of Germany and Italy".
In August 1940, when Hitler became serious about having Spain enter the war, a major problem that emerged was the German demand for air and naval bases in Spanish Morocco and the Canaries, to which Franco was completely opposed.
[8] In September, when the Royal Air Force had demonstrated its resilience in defeating the Luftwaffe in the Battle of Britain, Hitler promised Franco help in return for its active intervention.
Hitler promised that "Germany would do everything in its power to help Spain" and would recognise Spanish claims to French territory in Morocco, in exchange for a share of Moroccan raw materials.
In exchange for entering the war alongside the alliance of Germany and Italy, Franco, among many things, demanded heavy fortification of the Canary Islands as well as large quantities of grain, fuel, armed vehicles, military aircraft and other armaments.
Hitler attempted to force Franco's hand with a blunt request for the passage of several divisions of German troops through Spain to attack Gibraltar.
[citation needed] At Hitler's request, Franco also met privately with Italian leader Benito Mussolini in Bordighera, Italy on 12 February 1941.
In 1942, the planning of Operation Torch (Allied landings in North Africa) was considerably influenced by the apprehension that it might precipitate Spain to abandon neutrality and join the Axis, in which case the Straits of Gibraltar might be closed.
[15] Also, it was considered by Franco to declare war against Japan in March 1945, and by so joining to the Allies while also defending Spanish interests on its former colony, but the proposal was rejected by both UK and USA diplomacy.
[16] Franco's policy of open support to the Axis Powers led to a period of postwar isolation for Spain as trade with most countries ceased.
However, Franco ordered a gradual redeployment to the Pyrenees mountains along the French border in case of a possible German invasion of Spain as Axis interest in Gibraltar grew.
Concerns about the international situation, Spain's possible entry into the Second World War, and threats of invasion led Franco to undo some of these reductions.
[18] The Air Force and Navy also grew in numbers and in budgets, to 35,000 airmen and 25,000 sailors by 1945, although for fiscal reasons Franco had to restrain attempts by both services to undertake dramatic expansions.
At the time, Gibraltar was important for control of the western exit from the Mediterranean and the sea routes to the Suez Canal and Middle East, as well as Atlantic patrols.
Ten German divisions would advance to Barcelona and, if necessary, towards Salamanca to support the Spanish army in fighting another proposed Allied landing either from the Mediterranean or Atlantic coasts.
Despite calls by the writer Rafael Sánchez Mazas and other Spanish nationalists to annex Tangier, the Franco regime publicly considered the occupation a temporary wartime measure.
[29] A diplomatic dispute between Britain and Spain over the latter's abolition of the city's international institutions in November 1940 led to a further guarantee of British rights and a Spanish promise not to fortify the area.
Although Franco did not bring Spain into World War II on the side of the Axis, he permitted volunteers to join the German Army on the clear and guaranteed condition they would fight against Bolshevism (Soviet Communism) on the Eastern Front, and not against the western Allies.
Spanish foreign minister Ramón Serrano Súñer suggested raising a volunteer corps, and at the commencement of Operation Barbarossa, Franco sent an official offer of help to Berlin.
The Blue Division was trained in Germany before serving in the Siege of Leningrad, and notably at the Battle of Krasny Bor, where General Infantes' 6,000 Spanish soldiers threw back some 30,000 Soviet troops.
In August 1942, it was transferred north to the southeastern flank of the Siege of Leningrad, just south of the Neva near Pushkin, Kolpino and Krasny Bor in the Izhora River area.
[40] In May 2013 files were released showing MI6 spent the present-day equivalent of more than $200 million bribing senior Spanish military officers, ship owners and other agents to keep Spain out of the war.
The Allies were clearly gaining the advantage over the Axis and one double agent had provided enough information for Britain to make a detailed protest to the Spanish government.
[48] Around that same time, a contingent of Spanish doctors travelling in Poland were fully informed of the Nazi extermination plans by Governor-General Hans Frank, who was under the misimpression that they would share his views about the matter; when they came home, they passed the story to Admiral Luís Carrero Blanco, who told Franco.
[50] Diplomats discussed the possibility of Spain as a route to a containment camp for Jewish refugees near Casablanca, but it came to naught without Free French and British support.
[citation needed] After the war, Franco's regime was quite hospitable to those who had been responsible for the deportation of the Jews, notably Louis Darquier de Pellepoix, Commissioner for Jewish Affairs (May 1942 – February 1944) under the Vichy Régime in France, and to many other former Nazis, such as Otto Skorzeny and Léon Degrelle, and other former Fascists.
[58] José María Finat y Escrivá de Romaní, Franco's chief of security, issued an official order dated 13 May 1941 to all provincial governors requesting a list of all Jews, both local and foreign, present in their districts.