By June 11, 1937, the Basque forces had fallen back to the city of Bilbao, which was defended by a series of rushed fortifications called the "Bilbao's Iron Ring." The Iron Ring was poorly designed for defense.
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Prime Minister Juan Negrín needed to convince the French Premier Camille Chautemps that the Spanish Republic was still capable of military action after the disastrous losses of Málaga and Bilbao.
However, it was quite an antiquated defence concept akin to First World War fortifications, so it was vulnerable to modern warfare weapons of its time such as aircraft and artillery, and only 30,000 troops were defending it (it was conceived to be defended by 70,000) — therefore the Iron Ring was rather easily overcome by the Nationalist faction forces in the battle of Bilbao.