How will Brexit affect the British territory of Gibraltar?

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  1. Gibraltarians proudly British and equally European
  2. Border is a 300-year-old point of contention thousands cross daily
  3. Spain holds a veto over British terms for Brexit – and the Rock is a pawn

As soon as you leave Gibraltar’s airport onto Winston Churchill Avenue, it’s obvious that this UK outpost at Spain’s southern tip is very proud to be British. The subject of a three centuries-long sovereignty battle between London and Madrid, the British Overseas Territory of Gibraltar voted for sole UK control by around 99 percent in referendums in 2002 and 1967.

Gibraltar runway intersecting the only road to the Gibraltar-Spanish border (CC BY-SA 4.0; Photo by: Harry Ridgewelll/WikiTribune)
Gibraltar’s runway (left to right) intersects the only road in or out of the territory (CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)

However, the Gibraltarian identity is also extremely pro-European. Gibraltar Chronicle editor Brian Reyes told WikiTribune that people here have a “British nationality, but with a Mediterranean dimension,” that is “uniquely rooted in this rock.”

While the UK’s Union Jack flag can be seen all over Gibraltar, the territory’s gift shops are also full of soft-toy Barbary monkeys – more on them later – sporting European Union (EU) flags.

And although Gibraltar voted overwhelmingly to remain within the EU in the UK’s 2016 referendum, it could be one of the most affected by the coming Brexit, as it is removed against its wishes by the UK leaving this bloc. So WikiTribune visited to find out more.

Toy monkeys - the symbol of gibraltar - in giftshop. One with EU flag. (CC BY SA 4.0; Photo by: Harry Ridgewelll/WikiTribune)
A pro-European toy monkey in a Gibraltar gift shop (CC BY SA 4.0; Photo by: Harry Ridgewell/WikiTribune)

Despite being more than 1,000 miles from the UK, fish and chip shops and red telephone boxes made their way to Gibraltar. Yet, as several locals told WikiTribune, stereotypical, gloomy British attitudes didn’t. According to some Gibraltarians, this positive outlook may be required in an uncertain post-Brexit future.

Spain could make the Brexit deal offered to the UK not apply to Gibraltar, if it chose to use its second veto offered by the European Commission, and could close or even heavily restrict the movement of people or goods across the Spanish-Gibraltar border. Post Brexit, Gibraltar’s standard 10 percent corporate tax rate (PWC) could leave it vulnerable to EU economic sanctions (UK House of Lords report: PDF) and if Gibraltar’s citizens aren’t given free access to Spanish healthcare, Gibraltarians might be forced to return to the UK for specialist medical treatment.

Despite this, Reyes said while there’s a lot of post-referendum uncertainty here, “this is a pretty resilient community. I mean, we’ve seen challenge in the past … we’re optimists, seriously.”

Meanwhile on the mainland, 65 percent of UK citizens are either ‘not particularly confident’ or ‘not at all confident’ that Prime Minister Theresa May can secure them a good Brexit deal, according to a January poll by What UK Thinks: EU. 

People posing with one of Gibraltar's old telephone boxes
People posing with one of Gibraltar’s old telephone boxes (CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)

The 2.6-square-mile territory has boomed in the last 30 years thanks to its low corporation tax attracting companies from across the globe, staffed by thousands of Spanish and Gibraltarian workers who commute across the Spanish border daily.

Under the EU pillar of the free movement of people this is relatively easy, with up to 40 percent of Gibraltar’s workforce (UK House of Lords report: PDF) commuting to “the Rock” daily, and roughly 94 percent of Gibraltar’s tourists coming via land through Spain in 2014 (Open Britain report). But this could all change.

Brexit negotiations are still ongoing and the UK’s future relationship with the EU remains unclear, but a key tenet of EU membership is allowing all EU citizens the ability to move freely between members. Unless special Brexit arrangements are made, when the UK is no longer an EU member, the frictionless border between Gibraltar and Spain will cease to exist.

View from above of Gibraltar (CC BY SA 4.0; Author: Port of Gibraltar)
A view from above Gibraltar with the airport runway and port in foreground (CC BY SA 4.0; Author: Port of Gibraltar)

Send for more monkeys

Gibraltar is a historically fought-over territory, being a crucial entry and exit point to the Mediterranean Sea. It was captured by Anglo-Dutch forces in 1704, during the War of the Spanish Succession, and Spain ceded it to Great Britain as part of the 1713 Treaty of Utrecht.

Despite there obviously being peace now, the day after the UK’s EU referendum, Spanish Foreign Affairs Minister Jose Manuel Garcia-Margallo called for shared British-Spanish sovereignty of Gibraltar, causing a former senior UK politicians to suggest that the UK could go to war with Spain (Vox).

Gibraltar barbary macaques are often called Barbary apes but they are actually a species of monkeys, and not apes. Nobody is quite sure how they got to Gibraltar. (CC BY-SA 4.0; Photo by: Harry Ridgewelll/WikiTribune
Barbary macaques are often called Barbary apes but they are actually a species of monkey. Nobody is quite sure how they got to Gibraltar. (CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)

According to legend, however, while Gibraltar’s Barbary macaques remain in place, the territory will stay under London’s control. This even prompted UK Prime Minister Winston Churchill to import more monkeys from Morocco during World War Two, when their number dipped to just seven.

Not your average commute

Gibraltar’s airport runway crosses Winston Churchill Avenue, the only entry or exit road into the territory, forcing walkers, workers, and commuters to wait several times a day while flights take off and land. These visitors also have to go through the Spanish-Gibraltar border, which can take minutes or several hours.

But this border doesn’t just affect people’s commutes; a frictionless border is vital to workers from the nearby Spanish town of La Linea, which has one of the highest unemployment rates in Europe at about 35 percent, as well as Gibraltar’s economy.

Gibraltar is one of the largest ports in the Mediterranean Sea where ships refuel – known as ‘bunkering’. CEO and Captain of the Gibraltar Port Authority, Commodore Bob Sanguinetti, explained that 30 percent of Gibraltar’s bunker fuel was currently stored in nearby port city of Algeciras in Spain, as noted in the UK’s House of Lords Brexit: Gibraltar report (PDF). In the same report, the Government of Gibraltar highlight virtually all of its food comes from Spain and all of its waste is transported to Spain for processing.

 

Commuters and vehicles are held back while a flight takes off from the runaway which intersects the road to the Gibraltar-Spanish border (CC BY-SA 4.0; Photo by: Harry Ridgewelll/WikiTribune)
Commuters and vehicles are held back while a flight takes off from the runway which crosses the road to the Gibraltar-Spanish border (CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)

But crossing the border isn’t always plain sailing. Reyes told WikiTribune that “the border has in the past been used almost as a political pressure point. So it’s like a tap. Turn it on, turn it off.” 

In 2013, Spain imposed three days of increased vehicle searches in protest at the construction of an artificial reef created in Gibraltarian waters that Spain sees as its own, creating huge queues on the border.

A spokesman for ASCTEG, a group representing Spanish workers working in Gibraltar, told WikiTribune: “Gibraltar was accepted in the UEFA [European soccer championship] right. Problems on the border, two, three, four days … Someone from the British royal family came to Gibraltar for a visit, border closed.” 

President of ASCTEG, Molina Sanchez (left) and ASCTEG spokesman Juan Hose (right) Photo by: Harry Ridgewelll/WikiTribune)
ASCTEG President Molina Sanchez (left) and spokesman Juan Hose (right) Photo by: Harry Ridgewell/WikiTribune)

ASCTEG spokesman Juan Hose said the Spanish PP (People’s Party) uses excuses of drugs, arms, and money-smuggling across the border to justify searching everyone and causing long lines, but they never find anything and that really their motivation is political. “It’s ridiculous,” he said. “When we are so close … The two cities are together … it’s like a big city.”

Gibraltarian Stephanie Martinez told WikiTribune that the worst she’s experienced “were three-hour walking queues and 12-hour car queues” when things were really bad “political wise,” for what would otherwise be a five-minute walk through the border. Another commuter said the border problems arise “when these police officers from Madrid come down to help, the ones with the hats.”

Under EU membership, Gibraltar has been protected by such disputes to a degree, with the EU rejecting Spain’s demands to dismantle the reef and no threat of a permanent border closure, as this would be against EU membership rules.

Vehicles queuing at the border (CC BY-SA 4.0; Photo by: Harry Ridgewelll/WikiTribune
Vehicles queuing at the border for about an hour and a half on their commute home on January 24 2018 (CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)

In 1969 Spanish dictator Franco closed the Spanish-Gibraltar border. This border was not reopened until the 1980s, after the UK threatened Spain that unless they re-opened the border the UK would veto Spain’s entry to the European Community in 1986 (now European Union). Now the tables have turned.

The EU gave Spain the option to veto a transitional period and any Brexit deal offered to the UK from applying to Gibraltar, in its 2017 draft Brexit guidelines, posing another complication to the EU withdrawal process for the UK government. 

Gibraltar’s Deputy Chief Minister, Joseph Garcia, told WikiTribune: “People felt that it [giving Spain a veto] was an unnecessary slap in the face to people [Gibraltarians] who had voted 96 percent to remain in the EU.” 

But Garcia said that Gibraltar’s government’s view is that clause 22 of the guidelines, which gives Spain the veto, “is illegal” and it they will challenge it in court if Spain invokes it.

WikiTribune journalist Harry Ridgewell interviewing Gibraltar's chief minister, Joseph Garcia (CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)
WikiTribune journalist Harry Ridgewell interviewing Gibraltar’s chief minister, Joseph Garcia (CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)

However, if Madrid vetoed the UK’s Brexit deal and Gibraltar’s challenge was unsuccessful, would London reject a UK deal which didn’t include Gibraltar? It seems unlikely that the UK prime minister would put a population of roughly 30,000, ahead of 65 million people in the UK, even if Garcia says David Davis, the UK Secretary of State for Exiting the European Union, assured Gibraltar’s government that “they would not do the deal without Gibraltar.”

As The Guardian‘s European affairs correspondent, Jon Henley, put it to WikiTribune: “The $64,000 question, isn’t it … It’s pretty hard to see that the rights of the small rock off the southern tip of Spain are going to be privileged over a vital sector of the UK economy.”

Fredrick Martin, a senior trade union official for Unite‘s Gibraltar branch, and soon to be president of the Cross Frontier Group, a group representing businesses and trade unions on both sides of the border, is cautiously more optimistic. “I don’t think that they’ll [the UK will] actually believe that it’s good and proper to throw them [Gibraltar] underneath the bus, as it were, for the purpose of getting a better deal. I don’t think that’s going to be the case. Fingers crossed,” he told WikiTribune.

No deal

But where would no Brexit deal leave Gibraltar?

Gibraltar’s minister for financial services and gaming, Albert Isola, pictured in his government office (CC BY-SA 4.0; Photo by: Juan Carlos Teuma)
Minister for Financial Services and Gaming, Albert Isola, pictured in his government office (CC BY-SA 4.0; Photo by: Juan Carlos Teuma)

Gibraltar’s minister for financial services and gaming, Albert Isola, told WikiTribune that after the EU referendum it felt like a “morgue,” but for Gibraltarians it might not be as bad as first envisaged. Isola said that Gibraltar’s government completed a sectoral analysis of the effect of Brexit and found that roughly 90 percent of its financial services sector is accessing the UK market and 10 percent accessing the EU market. He added that the UK has assured the territory’s government that it will have the same access to the UK market after Brexit, and that has given businesses confidence.  

Chief executive officer of the Gibraltar Financial Services Commission, Samantha Barrass, told WikiTribune that what she’s seeing post EU referendum, “is actually a very calm reaction, and not the kind of sight that some people feared.” She said applications for new authorizations have increased, in a way she hadn’t anticipated and that firms are being “quite realistic and pragmatic.” They’re talking about staying in Gibraltar and potentially setting up new subsidiaries in another European jurisdiction, she said.

Samantha Barrass pictured in the reception of the Atlantic Suites, home to Gibraltar's Financial Services Commission CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)
Samantha Barrass pictured in the reception of the Atlantic Suites, home to Gibraltar’s Financial Services Commission CC BY-SA 4.0; Photo by: Harry Ridgewell/WikiTribune)

However, Peter Howitt, the founder of Ramparts law firm, which is based in the UK and Gibraltar, providing support for financial and tech companies, is less upbeat.

He said payments companies benefit from passporting services into the single market at the moment and that could be lost. If it is, he told WikiTribune “they would definitely need to have a new company that’s authorized within the EEA [European Economic Area – includes EU members and Iceland, Liechtenstein and Norway].”

Founder and director of Ramparts law firm, Peter Howitt (Copyright: Owned by Ramparts)
Founder and director of Ramparts law firm, Peter Howitt (Copyright: Owned by Ramparts)

In regards to the businesses he has spoken to Howitt said: “I can’t think of many people, or in fact anyone, who’s said that they’ve watched this unfold with confidence. Most people consider this to be a kind of train wreck, in slow motion, watching the establishment in the UK tear itself apart to some extent.”

“A decision needs to be made about whether the UK or the Conservative Party is gonna pursue a little England, splendid isolationist policy, which is a risk, I think. Or whether it’s gonna actually look at what the UK’s position should be in the modern world.”

In November 2016 the Chief Minister of Gibraltar, Fabian Picardo, said he wanted a bespoke deal for Gibraltar, including freedom of movement and access to the single market, even if the UK doesn’t try to secure these, according to Politico. He also pointed out that Gibraltar already has a special deal with the EU, as it’s not part of the European Union Customs Union and it is exempt from the Common Agricultural Policy, (Global government forum) so why couldn’t it have one post-brexit?

And The Guardian‘s European affairs correspondent, Jon Henley, told WikiTribune this January, when he was in Gibraltar a year ago: “What the administration there aiming for was the possibility of some kind of special status.”

However, when asked whether Gibraltar was pushing for a special deal, the Minister for Financial Services and Gaming, Albert Isola, told WikiTribune “I don’t believe we are.” Unless this changes, it seems Gibraltar will be stuck with the Brexit deal Theresa May negotiates.

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