UK Tries Again To Persuade Gibraltar To Join Spanish Process

by Ulrika Lomas, Tax-News.com, Brussels

18 September 2001

In an interview with the Gibraltar Chronicle published today, UK Foreign Office Minister responsible for Europe, tries to persuade reluctant Gibraltarians that a good future lies ahead for them if they join in a process of talks, saying: “If people want to get stuck in the past, the future will leave them behind.”

Although the terrorist crisis has meant that the next round of bilateral talks under the so-called Brussels process has had to be postponed until at least November, the British government is hoping to make substantial progress over the next 18 months towards an agreement with Spain in the long-standing dispute over Gibraltar.

Tony Blair has instructed Jack Straw, the Foreign Secretary, to resolve the 300-year dispute with Spain, which increasingly is the cause of disruption for European Union business and Anglo-Spanish relations. Currently a number of EU and OECD initiatives are in disarray, to put it politely, because of the long-term disagreement.

When the governments do meet officially it will be under the terms of the Brussels Declaration made in the joint communique issued in November 1984. There has been no substantive progress in the talks since they were broken off four years ago. Spain submitted proposals, known as the Matutes proposals, in 1997 for a period of joint sovereignty for at least 50 years, followed by autonomy within Spain, but the UK has never accepted these proposals as a basis for discussion.

Gibraltar's Chief Minister Peter Caruana says: "as far as I am concerned the Matutes proposals have been buried and disposed of in a manner that is entirely effective and satisfactory for Gibraltar. It is not credible to argue otherwise." The Opposition alliance however accuses the Caruana government of having a secret agenda which could undermine Gibraltar's position in tri-partite talks, and also condemns the failure of the British Government to reject the Matutes proposals 'categorically, unambiguously and formally'. The Opposition says that it is contrary to Gibraltar's interests for the Government of Gibraltar to participate in the Brussels negotiating process in any shape or form.

But London and Madrid believe that the issue of Gibraltar is an unnecessary stumbling block in the way of improved relations within a European context at a time when Tony Blair, the prime minister, and José María Aznar of Spain have struck up a good personal relationship, and Peter Caruana, Gibraltar's chief minister, is being encouraged by the Foreign Office to join future negotiations on the basis of a new agenda that could lead to the sharing of the airport in Gibraltar.

He is unlikely to have much local support - the mood towards the UK in Gibraltar at present is anything but co-operative, since the ex-colonial master has refused to support Gibraltar in its fight to retain its low-tax structure against EU efforts to ban 'unfair' tax practices as illegitimate state aid, driving the territory to sue the European Union and to make emergency plans to survive in a hostile world. One of its only cards is to remain as a thorn in the flesh of the EU - going along with efforts to resolve the sovereignty issue would simply reduce its power to influence events.

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