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The Hon. Joseph Garcia MP calls for fluid Gibraltar-Spain border post-Brexit

Event / SPEECH

Date: 17/02/2020

On Monday 17 February 2020, Deputy Chief Minister and Minister for Europe Dr Joseph Garcia MP delivered a speech at the European Policy Centre on Brexit’s other land border: Gibraltar and the UK-EU relationship:

Fabian, ladies and gentleman, colleagues, it is a privilege for me to be here today.

Thank you all for making the time to come out to this briefing.

A warm thank you also to the EPC for having invited me here to speak on behalf of a small territory of 32,000 people which is often overlooked.

I know that the work that you do here and the debate that you generate make an important contribution to political life in the heart of the EU.

So,   “Brexit’s   other   land   border:   Gibraltar   and   the   future   UK-EU relationship”.

You will know that there are technically three Brexit land borders with the EU which the UK is ultimately responsible for.

These are the border between the Republic of Ireland and Northern Ireland.

The border between the Republic of Cyprus and the UK Sovereign Bases on the Island.

And the border between Gibraltar and Spain. There are also sea borders.

Not least, for example, in the UK Overseas Territory of Anguilla, where they worry about the connection by sea to Dutch and French islands in the region.

The reality is that the UK Government, in these negotiations, as it did in the Withdrawal process, represents a wide variety of territories each with their own Governments and with their own peculiarities and interests.

The three Devolved Administrations – Scotland, Wales and Northern Ireland.

The Crown Dependencies – Jersey, Guernsey and the Isle of Man. And the Overseas Territories.

This includes Anguilla, Bermuda, British Virgin Islands, Cayman Islands, Falkland Islands, Montserrat, Pictairn Islands, St Helena and the Turks and Caicos.

Among the latter of course is Gibraltar.

The only territory that was actually part of the EU and that has now left the club.

This happened only 17 days ago, when the EU-UK Withdrawal Agreement came into effect.

It settled what was perhaps the most controversial and messy divorce in British history (with all due respect to Henry VIII and Catherine of Aragon).

In fact, I am conscious of the fact that this is the first time that a Gibraltar Minister addresses the EU bubble with Gibraltar as a Third Country.

An accolade, believe me, I would have rather not have had.

Seven years on from David Cameron’s infamous Bloomberg speech, who would have predicted the events which have led us to where we are today?

But as Cameron himself said in that speech, and I quote, “you will not always get what you want”.

That statement is truer with respect to Gibraltar than it is with respect to any constituency which voted in the UK referendum.

On 23 June 2016, 95.91% of those who cast their vote in Gibraltar voted to Remain.

Not even here in the heart of the European Quarter in Brussels, would you get such a result.

Not even perhaps if I asked for a show of hands in this room would the EU enjoy such an overwhelming degree of support.

Yet, after 47 years of EU membership, and despite our emphatic support for the preservation of our relationship with the European Union, we have accompanied the UK as it left political Europe.

We chose to be pragmatic.

To get on with the job of protecting the interests of Gibraltar as we left.

And now as we move forward into the future, I would submit that in those discussions to come Gibraltar should not be the victim of Brexit.

The people of Gibraltar do not deserve that.

As we reflect on Gibraltar’s history in the EU, perhaps it is right for me to start at the very beginning.

To turn the clock back in time and recall what Gibraltar was like when it joined the European Economic Community on 1 January 1973.

It is difficult to imagine this but, as a child, growing up in Gibraltar I did so confined in a territory of less than 6 square kilometres, roughly the size of I-x-elles.

Gibraltar was effectively isolated from mainland Europe.
Because, on 8 June 1969, just over 50 years ago, terrestrial links between Gibraltar and Spain were cut off by the then dictator, General Franco.

The border we are discussing today was physically shut. Sea links with Spain were stopped too.

Telephone communications were terminated.

Gibraltar became, to all intents and purposes, a city under siege. Life was not easy.

Times were hard.

Families on both sides of the border were torn apart. Lifelong friends were separated.

Thousands of Spanish citizens who worked in Gibraltar could no longer access their jobs.

Many of them chose to emigrate to the UK or to Germany. No tourists could come in by land either.

The blockade was absolute.

In fact, Franco predicted that Gibraltar would “fall like a ripe fruit”. It was a prediction that never materialised.

The people of Gibraltar faced up to the dictator and endured nearly sixteen years locked up in a few square kilometres.

I provide this snapshot because it is important to understand how the operation and closure of that border at that time had a devastating impact on everything around it.

This cannot be allowed to happen ever again.

It was against this backdrop, that Gibraltar joined the then EEC alongside the UK with a sense of optimism and positivity.

Without Spain in the club, the UK was free to negotiate a tailor made arrangement for Gibraltar.

This took account of Gibraltar’s geographical features and the fact that, at the time, cut off from Spain and from Europe, most of its goods came from Morocco, the nearest neighbouring third-country.

Flexibility and pragmatism ruled the day.

With creativity, imagination and a dash of good faith, technical, essential, tailor-made solutions for Gibraltar were agreed with respect to certain areas.

That same creativity, imagination and good faith is what is required today. So, what were those arrangements?

In accordance with what was then Article 227(4) of the Treaty of Rome the EU Treaties were applied to Gibraltar as a European territory for whose external relations a Member State is responsible.

In our case the Member State is, or I should say was, of course, the United Kingdom.

Gibraltar remained outside the Common Agricultural Policy and the Common Fisheries Policy.

Gibraltar was left out of the Customs Union and outside of the scope of EU rules on indirect taxes such as VAT and excise duties.

This was perfectly logical.

The closed border meant that Gibraltar was physically cut off from the EEC and in any case back then political Europe started at the Pyrenees because Spain and Portugal were not members.

This tailor-made status allowed Gibraltar to freely import goods mainly from Morocco and thereby feed and sustain its population.

Consequentially, the rules on the free movement of goods do not apply to Gibraltar either and Gibraltar does not form part of the Common Commercial Policy in so far as trade in goods are concerned.

It is because of these arrangements that import/export procedures between Gibraltar and the EU have always been carried out as though Gibraltar were a third country.

There have always been customs controls in force at the land border between Gibraltar and Spain.

This is partly where the similarities between our border and, in keeping with the title of this discussion, “Brexit’s other land border”, end.

And it serves to clarify that whereas the debate in the context of Northern Ireland has primarily been about the movement of goods, in Gibraltar it is essentially about the movement of persons.

The issue in Gibraltar is not controls and checkpoints. These already exist.

The issue is how the EU or Spain will exercise such controls at the end of the transition.

But more about the border later on.

Turning back to Gibraltar’s EU status it is important to understand that all other parts of the acquis were applied to Gibraltar in full.

The obvious exception was those areas where the UK secured an exclusion for itself.

EU rules on the freedom of establishment, the freedom of movement of capital, the freedom to provide services and the freedom of movement of persons are all observed and enjoyed in Gibraltar.

And this will continue during the transition until the end of the year.

Those rules are applied and enforced in Gibraltar as if Gibraltar were a Member State of the EU in its own right.

In keeping with our Constitution, legislation passed by the Gibraltar Parliament transposes EU law into Gibraltar’s legal order wholly separately from what may be done in Westminster for the United Kingdom.

The UK only retains responsibility for Gibraltar’s defence, internal security and external affairs, with an important carve-out.

This is that matters which are the responsibility of Gibraltar Ministers do not cease to be so even if they arise in the context of the European Union.

So although smaller both in size and in population, Gibraltar enjoys more autonomy than Scotland, Wales or Northern Ireland.

Indeed, probably greater autonomy and more self-government than any region of Europe.

This tailor-made status distinctively makes Gibraltar stand apart from any other British Overseas Territory or from the Crown Dependencies.

Gibraltar is uniquely the only member of the British family of nations, outside of the United Kingdom, that enjoys such a deep and special relationship with the European Union. 

This is why Gibraltar was the only territory outside of the UK that voted in the referendum.

Gibraltar’s economy flourished as part of the Single Market and became the modern, service-based economy that it is today.

Curiously, the application of EU rules also helped to develop our trading relationship in services with the UK.

Indeed, the United Kingdom remains the main market for financial services institutions established in Gibraltar. 

One in four cars in the UK are insured through Gibraltar companies. That access to the UK market has been guaranteed post-Brexit.

In the event of no agreement between the UK and the EU, or even if there is an agreement, Gibraltar could well become the only part of Continental Europe to enjoy frictionless market access in services into the UK.

Moving on, I have to say that any account on the history of Gibraltar in the EU would not be complete without a mention of Spain.

I should point out that our time in the EU was rather boring up until 1986 when Spain joined the European Community.

The most immediate positive effect of Spanish accession was that Spain had to fully reopen the land border as a prerequisite to joining.
The rusty gates were unlocked and swung open in February 1985, ten years after General Franco had died.

They had been shut for close to 16 years.

With the opening of the border Gibraltar was once again able to regenerate its tourism industry.

Ten million tourists are visitors to Gibraltar every year. They account for a quarter of our economy.

Once the border opened, Gibraltar was once again able to offer jobs, to thousands and thousands of citizens who live across the frontier in Spain.

There were grounds for a real sense of positivity and hope with Spain’s accession.

The genuine expectation that a new page would be turned. A new beginning.

Sadly, this proved to be short-lived.

It became clear almost at once that instead of allowing political differences to dissolve, some in Madrid saw the EC as a means of advancing their sovereignty claim over Gibraltar.

The people of Gibraltar, from the point of Spanish accession, have often felt hard done by in the EU.

Five years ago, in this very forum, I spoke in detail about these issues but, today, I want to look forward.

So what explains the 96% result in favour of continued membership?

As President Von Der Leyen very recently put it, “the relationship may not have always been smooth or perfect – what relationship ever is. But, the good far outweighs the difficult”.

This point was well understood in Gibraltar.

And, at a time when the EU project was being seriously questioned, one would have thought that Brussels would have embraced the people who gave them a 96% vote of confidence.

That they would have been more generous with Gibraltar. But there was no embrace and no generosity.

In the event, what happened was almost the reverse.

The people of Gibraltar had good reason to be worried in 2016. Threats were made.

First, that once Gibraltar left the European Union all options were open to Spain including closing the border completely.

Second, that any relationship between Gibraltar and the EU had to come through shared sovereignty with Spain.

It is relevant to note that the very principle of shared sovereignty had already been rejected by 98% of the population in a referendum that took place in 2002.

The Brexit process did not get off to a good start.

And the degree of obsession with Gibraltar at that time was considerable. Indeed, it was markedly different to what happens elsewhere.

There are, as you know, a number of micro-states and territories in different parts of the European Union.

Small countries like Andorra, Liechtenstein, San Marino, Monaco and even the Vatican City.

They are the product of their history and of their own distinct political and constitutional evolution.

All have found a modus vivendi with their large neighbours.

I call on the EU, in general, and on Spain in particular, as our nearest EU neighbour, to find a modus vivendi with Gibraltar too.

But we cannot apply an eighteenth century solution in the twenty-first century.

In the eighteenth century, Kings and Princes could hand over territories from one to another regardless of the wishes of their inhabitants.

Those days ended a very long time ago. Today, people come first.

The politics of conflict and confrontation must give way to dialogue and cooperation.

It is important to recall that as the exit process started the EU, pressured by Spain, unnecessarily singled Gibraltar out for special treatment – apart from the rest.

This came at the first available opportunity after the UK despatched its notification to initiate the Article 50 process.

Clause 24 of the European Council’s Guidelines for the withdrawal negotiations published on 29 April 2017 stated as follows:

“After the United Kingdom leaves the Union, no agreement between the EU and the United Kingdom may apply to the territory of Gibraltar without the agreement between the Kingdom of Spain and the United Kingdom”.

For the staunch supporters in Gibraltar of the European Project and the passionate believers of the principles enshrined in the EU Treaties, myself included, this was a bitter pill to swallow.

At first it was thought that the words “after the United Kingdom leaves the Union” would have meant that this veto would not apply to the Withdrawal Agreement but only to the Future Relationship.

Indeed, even President Juncker thought the same.

In an answer to a European Parliament written question given on 6 July 2017, Juncker stated that this additional veto, I quote, “does not relate to the withdrawal negotiations with the United Kingdom, but to the future relationship between the EU and the United Kingdom”.

But when it comes to Gibraltar, we have sadly learnt that anything goes.

Despite what President Juncker had said, Gibraltar finally ended up in a negotiation for our inclusion in the very withdrawal arrangement itself and obviously in the transition that went with it.

 But think about it because it made no sense.

Why would anyone want to exclude Gibraltar from the Withdrawal Agreement?

What would anybody gain?

Why would Spain want to deprive its own citizens from enjoying the rights protected by the Withdrawal Agreement?

What purpose would a no-deal Brexit have served at Spain’s only land border with a UK territory?

There is no logical explanation.

But in the midst of this negotiation, the view of Spain was the dominant voice in Brussels.

Inexplicably, after this, Gibraltar was expressly excluded by name from the EU’s no-deal Brexit contingency measures as if businesses and citizens in this small corner of Europe did not matter.

Let me ask once more.

What did anybody stand to gain by the exclusion of Gibraltar from EU no deal planning measures?

Even in the measure on visa-free travel, where Gibraltar was included, an awkward inflammatory footnote was added, bluntly referring to Gibraltar as a “colony”.

The term added absolutely nothing of legal value to the operative part of the Regulation.

So why put it there?

And this move came after the European Parliament rapporteur, who was supported by his co-rapporteurs in opposing this text, was, in an unprecedented move, forcibly removed from his position.

This, in my view, completely undermined the co-decision procedure and placed a huge question mark over the European Parliament’s purported decision-making powers.

The underlying attitude, which to many represented no more than the bullying of a tiny territory by a huge supranational organisation, did nothing to build confidence, trust or goodwill.

Nonetheless, Gibraltar was, as I said, included in the territorial scope of the Withdrawal Agreement.

This came after the first direct engagement between Gibraltar and Spain for many years when Spain’s Partido Popular was still in office.

Such engagement was part of a variable geometry of negotiations that also included the United Kingdom and the European Union – in two, three or four sided talks.

This led to the negotiation of the Gibraltar Protocol to the Withdrawal Agreement.

There is one such Protocol for each border – Northern Ireland, Cyprus and Gibraltar.

Four Memoranda of Understanding were also negotiated between Gibraltar and Spain.

These dealt with practical arrangements of a local nature concerning the environment, police and customs cooperation, citizens’ rights and exciseable goods.

A tax treaty completed the package.

This was also negotiated between Gibraltar and Spain.

It was signed by the United Kingdom, in respect of Gibraltar, as the State responsible for Gibraltar’s international relations.

That package secured Gibraltar’s orderly exit from the European Union.

Moving forward now, the future negotiations have started in the same way as the exit negotiations begun.

You will be aware that the EU, at Spain’s behest, has stated that any agreement with the United Kingdom, on the basis of the draft negotiating directives published earlier this month, will not include Gibraltar.

Not that there will not be an agreement, but that it will not be on the basis of this mandate.

Instead, the UK Government has made it abundantly clear on repeated occasions that it will negotiate the future agreements implementing the Joint Political Declaration also on behalf of Gibraltar.

Whatever form an agreement may take, it is obvious that a discussion of the future relationship between Gibraltar and the European Union will involve Spain as our nearest EU neighbour.

Gibraltar too has the power to walk away..

This in effect brings me to where we are now.

To the pertinent issue facing Gibraltar today – this being its future relationship with the European Union.

But before turning to content I want to deal with approach.

And by that I mean how Madrid may focus this issue.

There are those who say that Spain must capitalise on the apparently historic opportunity that she has to recover sovereignty over Gibraltar after 300 years.

In other words, the medieval approach.

An approach which tramples over the right of the Gibraltarians to determine their own political future.

 An approach which puts flags and nationalism first.

An approach where citizens, workers, businesses and neighbourly relations are mere afterthoughts which can be sacrificed.

An approach that will clearly get us nowhere.

There is, of course, a different way of doing things.

A door that can be opened with mutual respect.

It is significant that the current centre left, socialist Prime Minister, Pedro Sanchez, has called for a different approach.

One which puts the historic, perennial sovereignty question to one side and focuses instead on the opportunity we now have to create an area of shared prosperity straddling either side of the border.

Spain’s new foreign minister, Arancha Gonzalez Laya has echoed this.

Speaking very recently, she said that “for citizens a discussion on sovereignty is all well and good but what they really care about is whether they will be able to cross the border”.

She continued to state that Spain would be doing a “disservice” to its citizens if at the end of this process their day to day issues are not resolved.

We will not agree on everything.

But it is this pragmatism that creates the space for us to talk.

As I said, the single main issue for Gibraltar in relation to a future outside the European Union is the land border with Spain.

The manner in which persons and goods cross the border after 31 December 2020 is vital to increasing the level of shared prosperity that already exists.

The border is a vital artery.

It needs to remain unclogged.

It is the pillar on which rests the economic interplay between communities on both sides.

It is also the conduit which allows social, cultural and human interaction to take place.

As at the end of December last year, Gibraltar employed 14,464 frontier workers.

There were 6425 frontier workers in 2012.

14,464 now.

This means that 8039 new jobs have been created for frontier workers since 2012, which represents an increase of over 120%.

These are people who reside in Spain but who work in Gibraltar.

14,464 persons in the grand scheme of things may not sound like much.

But they make up over 40% of the total workforce in Gibraltar.

And when taken as a whole, it makes Gibraltar the second largest employer for the whole of Andalucía – second only to its regional government.

These workers are employed in different areas of the economy.

In financial services, catering, social services, health services, hotels, restaurants and retail.

There is virtually zero unemployment in Gibraltar.

In sharp contrast, unemployment rates in the surrounding region of Spain were acutely hit by the 2008 economic crisis.

This oscillates at alarming rates around the 30% mark and is even higher amongst young people.

That is why Spanish politicians on the other side of the border, Spanish pressure groups, Spanish trade unions, business associations and other stakeholders are all calling for fluidity at the border to be maintained.

The bulk of the frontier workers are made up of 9320 Spanish and 2296 UK nationals.

However, some of you may be surprised to learn that every single Member State of the European Union has frontier workers employed in Gibraltar.

For example, there are 831 Portuguese, 424 Romanians, 193 Poles, 125 Germans and even 2 Luxembourgers.

This makes Gibraltar a microcosm of what the EU is all about.

Citizens living on one side of a border and working in another.

And it cannot be lost going forward.

The border is not only important in the context of frontier workers but also in the context of tourism, a mainstay of the Gibraltar economy.

Millions of tourists visit Gibraltar each year via the land border.

This sector generates some two thousand jobs many of which are then occupied by frontier workers.

Therefore any border restriction which adversely affects tourists would have a knock-on effect on workers.

It is all inter-connected.

The latest figures published by the Spanish Ministry for Commerce show that Spain exported goods valued at 1.5 billion euros to Gibraltar in one year.

The figures show that Gibraltar is the largest export market for the province of Cadiz next door.

That Cadiz sells more to Gibraltar than to the United Kingdom or to France.

The positive economic impact from residents of Gibraltar in the surrounding area should not be underestimated either.

Residents of Gibraltar spend over 80 million euros a year purchasing goods and services in Andalucia, in shops, in restaurants, in hotels and elsewhere.

It is relevant to recall that during a time of lengthy border delays in 2015 residents of Gibraltar unilaterally decided to stay at home instead of queueing up for hours to cross into Spain.

This led to complaints from Spanish business organisations who claimed that traders had seen a loss in revenue of some 40%.

There is also the important factor of human relations, family links, friendships, sports and cultural exchanges.

Therefore the message is simple.

Border fluidity for everyone equals greater prosperity for everyone.

Residents, Workers and Tourists.

This is not a matter of political opinion.

It is simple economics.

Indeed, Spain’s new Foreign Minister made precisely this point in a constructive tone to the Financial Times last week.

“The Gibraltar population needs the Spaniards to function,” she said, “and the Spaniards need the Gibraltarians in order to enhance their prosperity.”

We welcome the existing level of shared prosperity and we want to generate even more.

Therefore a pragmatic, a well-balanced, and a sensible solution to the border is as much in the interest of the neighbouring Spanish region as it is in the interest of Gibraltar.

So, finally what are the solutions then?

First of all, I think it is important to state that a solution for the border between Spain and Gibraltar would have zero impact on the United Kingdom itself.

There are already customs and immigration controls between Gibraltar and the United Kingdom.

This means that the land border between Gibraltar and Spain would not become a soft underbelly for those wanting to illegally enter the Schengen Area from the United Kingdom or vice versa.

And the UK Government has always supported arrangements at the border with Spain which promote fluidity and shared prosperity in the region.

If the political will is there on the EU side, legal solutions will follow.

It is politics that drives the law and not the other way around.

One possibility is that of a common travel area between Gibraltar and the EU.

Indeed, for those listening carefully 5 years ago, I mentioned this possibility in this very forum.

Being outside the EU, as you know, is not a bar to fluid travel across EU borders.

Switzerland, Liechtenstein, Iceland are all examples of non-EU Schengen States.

Monaco, San Marino and Andorra also benefit from facilitated border arrangements with the European Union.

If frictionless border processes are what we all want, there is no need to reinvent the wheel – the solution already exists.

And there are other potential solutions too in EU law already.

Therefore the message from the Government of Gibraltar is that we need to be ambitious.

We need to genuinely seize this moment to obliterate the politics of the past.

But the mind-set must move from the negative to the positive.

Away from talk of vetoes and of exclusions.

Because citizens want to hear solutions and not threats.

Because the 1 January 2021 is just round the corner,

for the person who relies on the border to feed their family;

for the company whose business in Spain is sustained by customers from Gibraltar;

for the many entities that now earn millions of euros exporting to Gibraltar;

for residents on both sides of the border;

for those with friends and family on the other side;

and for those genuinely concerned about their future.

And it is only with a future agreement that is good for Gibraltar that those concerns will be allayed.

Because what is good for Gibraltar is good for the surrounding region.

We are at a historic moment, and whilst the challenges are great so too are the opportunities.

So let me repeat what I said earlier.

Border fluidity for all equals shared prosperity for all.

That is the message that I want to leave with you today.

Thank you.

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