With all of the noise surrounding Britain’s impending departure from the European Union, there is no shortage of important smaller details that have fallen off of the public’s radar. One of these is the overseas territory of Gibraltar, a tiny territory with a population of about 32,000 that shares a border with Spain.
Now that Boris Johnson’s Withdrawal Agreement has passed in the Commons and the UK looks sure to leave on January 31st, politicians on both sides of the Channel will have to focus their attention on this complicated territory, which is also set to leave the EU on the same day.
Let’s take a look at some of the key issues that have not been resolved in the WA that will likely become sticking points as negotiations on the future relationship between the UK and EU kick off this year.
The most important sticking issue with Gibraltar concerns sovereignty. The territory was taken from Spain and became part of the UK all the way back in 1713. Since then, it has operated essentially as an outpost of the UK, with distinctly British identity and the vast majority of residents holding UK citizenship. Three centuries later this continues to be a thorny diplomatic problem, with Spain continuing to claim that it is Spanish territory, a position that has been amplified since the Brexit vote.
2. The Economy
Gibraltar may be small, but it is an economic tiger in the region. There is less than 1% unemployment, and its per-capita GDP of around £52,000 is one of the highest in Europe. The vast majority of trade to and from Gibraltar passes through the Spanish (EU) border, meaning that the economy is dependent on whatever trade arrangement is expected to be negotiated this year. In addition, Gibraltar’s economy has been propelled by the online gambling industry in recent years. The proliferation of innovative pay by phone casino companies that allow people to play the latest online slots from their mobile is a huge contributor to the local economy, as are other niches of the iGaming sector. Since the gambling industry is governed by UK laws, it will be interesting to see how the EU reacts during negotiations.
3. Cross-Border Travel & Migration
Every single day, thousands of people from both sides of the border take advantage of EU Freedom of Movement to work in Gibraltar and Spain. While Gibraltar, just like the UK, is not in the Schengen Area (meaning that there are checks and passport controls at the border), the likely end of free movement in January could cause major headaches for those who live in Spain but work in Gibraltar, and vice versa. There are also European nationals living in Gibraltar who, due to FoM, never felt the need to gain permanent residency status in the UK territory. This will also have to change as the UK detaches itself from the EU’s migratory arrangements. Based on what we know so far, the UK government has no intention of ceding the sovereignty of Gibraltar to the EU or to Spain anytime soon. This means that unique arrangements will have to be made for this historic roc