Spain Unwilling to Keep Gibraltar in EU Single Market

Mariano Rajoy says Spain would block a special Brexit deal for the peninsula.

Since Britain voted to leave the European Union in June, Spain has ramped its rhetoric surrounding the territory of Gibraltar, a sliver of land that has been in British hands for centuries but to which Spain continues to claim sovereignty.

Earlier this month, the acting foreign minister, José Manuel García-Margallo, threatened to “put up the flag” on the Rock, hinting at a Spanish takeover.

He insisted that if Britain leaves the EU, “Gibraltar is out” as well, even though 96 percent of its residents voted to stay.

Rajoy’s warning

García-Margallo’s words may have been dismissed as bluster were it not for Prime Minister Mariano Rajoy saying the same thing.

Spain’s ABC newspaper reports that Rajoy told his British counterpart, Theresa May, on Thursday that he would not allow Gibraltar to remain in the European single market if the United Kingdom leaves.

Spain, as one of the EU’s remaining 27 member states, has the power to block any Brexit deal.

Rajoy didn’t reiterate Spain’s claim to Gibraltar, according to ABC. But blocking an arrangement that would keep the peninsula in the single market might give it little choice but to accept a form of “shared sovereignty” between Britain and Spain, as García-Margallo has suggested.

“Existential threat”

Fabian Picardo, Gibraltar’s chief minister, told the BBC recently that leaving the single market would pose an “existential threat” to his territory’s services-based economy.

Gibraltar used to be heavily dependent on British subsidies and defense jobs. Now it supports itself. Finance, shipping and tourism are the mainstays of its economy, but all those industries depend to some extent on open borders and trade with the rest of the EU.