Brexit: How Does it Look from Gibraltar?

In April 2015, in the run-up to the British general election, I predicted that, counter-intuitively, the best outcome for the UK overseas territory of Gibraltar might well be a Labour or Labour-SNP coalition government.  True enough, the Conservative Party has traditionally been seen as a more resilient defender of Gibraltar’s sovereignty, whilst the Labour Party, drawing upon a history of anti-colonialism, has been more receptive to either an accommodation with Spain or else a repudiation of the British claim.  But for Gibraltar’s economy, my analysis was that the Conservative Party manifesto pledge to hold a referendum over membership of the European Union, Brexit from which would also see Gibraltar leave, could be disastrous.

In the immediate aftermath of the election, with the date for a referendum still undecided, and the sentiments of the British electorate towards the European Union still woolly, some Gibraltarian commentators were happy to pin their flag to the Conservative mast; “It seems to be a non sequitur that Britain can thrive outside of the EU”, “I just don’t see a Brexit coming”.

One year later, panic is clearly setting in.  In the UK, the confidence of the currency markets in sterling has been considerably dented; in the event of a Brexit, banks have threatened to remove parts of their operations to mainland Europe; and the United States of America has cast considerable doubt over whether or not it would negotiate a free trade deal with a Britain that was outside of the European Union.  If Keynes were here to comment, he would probably say that we are facing ‘a financial Dunkirk’.

The UK economy may well be waiting for a moment of deliverance in June, but until then Gibraltar’s economy is facing Armageddon.  There were dramatic scenes as the Chief Minister of Gibraltar offended the pro-Brexit chair of the All Party Parliamentary Group for Gibraltar by declaring that true friends of Gibraltar would be campaigning to remain in the EU.  The Gibraltar Stronger in Europe Campaign is backed by all of Gibraltar’s main political parties and economic and political interest groups.

Gibraltar’s economy is predicated around trade within the European Union and dislocation from this would be disastrous.  And just as uncertainty in the UK is having economic consequences, uncertainty over Gibraltar’s future role in the EU is having serious political consequences in regards to the Spanish claim to sovereignty.  In a threat reminiscent of Franco’s closure of the Gibraltar frontier between 1969 and 1985, some Spanish ministers have suggested that if Gibraltar were not in the European Union, Spain would be well within its rights to seal the border, cutting off Gibraltar from vital markets, food supplies, and labour.

All of this stands in sharp contrast to the spirit of recent events held in Gibraltar to commemorate the eightieth anniversary of the start of the Spanish Civil War of 1936-39.  During an evening lecture, myself and Gareth Stockey, with whom I co-authored Gibraltar: A Modern History, spoke alongside officers from Gibraltar’s branch of UNITE the Union, Candido Mendez, the retiring Secretary General of the Spanish trade union the UGT, and Ignacio Fernandez Toxo of the Spanish Workers’ Commissions, the CCOO.  Regardless of nationality, all of the speakers at the lecture emphasised that, in June 1936, refuge was given in Gibraltar to Spaniards fleeing persecution from the nationalists. They emphasized the cordial relationship, at a local level, between Gibraltar and its neighbours.

Gibraltarians will be voting in the EU referendum, but it is hard to imagine that many votes for a Brexit will be cast on the Rock.  If the UK does leave the European Union, I cannot help but feel that it will not be Scotland alone, but Gibraltar too, which will look to redefine its constitutional relationship with Westminster.  And if the UK remains, one wonders to what extent, in the process of campaigning, Gibraltar’s relationship with those politicians who are sympathetic to Gibraltar’s interests might be weakened by a strident ‘stronger in Europe’ campaign that alienates members of the UK parliament who are both pro-Gibraltar and pro-Brexit.