Economy of Madrid

Until 1900 Madrid was almost entirely an administrative city. Its few industries produced goods for consumers in the city itself.

Beginning in the early 20th century, Madrid grew to be an important industrial center.

The city’s major industrial products include motor vehicles, aircraft, chemicals, pharmaceuticals, processed food, printed materials, and leather goods.

Because the area around Madrid has few industrial raw materials such as iron, coal, or oil, the city has little heavy industry.

Its factories feature light manufactures and assembly of products, including cars, trucks, appliances, and furniture, using semifinished components made elsewhere.

While Madrid is an important industrial center, it is more important as a center of service activities. These include government, banking, publishing, insurance, and finance.

Madrid is also a major center of Spain’s tourist industry. For example, more than 41 million tourists visited the country in 1996; as a result, Madrid has large hotel and restaurant industries.

Madrid is also the center of Spain’s highway and railroad systems. Both systems were built with roads and lines running from Madrid to Spain’s most important seaports.

Since the mid-1970s the government has moved aggressively to upgrade both systems, and excellent freeways now connect Madrid to Spain’s other important cities.

The railroads have not been developed as rapidly for heavy freight, but the passenger system has improved greatly.

Regional commuter lines run between Madrid and the nearby provincial capitals of Segovia, Guadalajara, and Toledo.

The country’s first high-speed rail line was begun for the Sevilla World’s Fair in 1992, making it possible to travel between Madrid and Sevilla in about two hours.

The city of Madrid has extensive subway and bus systems.

The subway system doubled in size between the early 1960s and the late 1990s, and it now reaches the outlying industrial and residential communities.

Madrid’s airport, Barajas Airport, is served by airlines from all over the world and is also the center for an air service that connects most major Spanish cities to Madrid.