The year following the passage of this law was marked by rapid expansion
in the national marine. Then came a more rapid decline. This was due, it
is assumed, to increased taxes, and business depression occasioned by
the colonial wars, involving enlarged Government expenditures and the
cutting off of much colonial trade.[EC] During the war with the United
States (1898) Spain lost eighteen large steamers of 31,316 tons. After
that war, with the development of her national resources, the Spanish
marine again began rapidly to grow.[EC]

In 1909 (law of June 14) the system was extended with the addition of
general navigation bounties calling for an annual expenditure of
2,750,000 pesetas ($530,750). For ships making monthly sailings to
various named points, among them Brazil, Uruguay, and the Argentines,
and semi-weekly sailings to Algeria, bounties were provided ranging from
seven to seventeen cents per ton gross for every thousand miles run, to
continue for a period of ten years. Spanish ships manned by Spanish
crews and ranked by maritime agencies as first class were made eligible
to them. All ships receiving these bounties must admit naval cadets and
perform certain services for the Government. To shipbuilders, as off-set
to the duties on imported materials which they must pay, bounties for
port materials as well as for ships were granted by this law. The
construction subsidies were increased to $13.84 per gross ton for wooden
ships not possessing their own motor power, and $17.30 self-propelling;
$20.76 for iron or steel ships without motor, $27.68 for ships for
freight only, $29.41, freight and passengers; and $32 passengers only.
Ten per cent of the bounties for passenger ships was to be added for
each knot made above fourteen per hour. The sale of a ship to a
foreigner within two years after the ship's construction was made
invalid unless about a third of the bounty received be repaid. Ships
built abroad for Spanish citizens were to be relieved of certain duties