Nigel Farage wants out of the European Union, but what would it mean for Gibraltar? (Getty Images)
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The rise of UKIP: would an EU exit cut Gib’s throat?

Gibraltarians have grown disenchanted with the EU, yet their continued economic success depends on it. In light of UKIP’s surge in the recent European elections, Michael Castiel asks what an in-out referendum would mean for the Rock and which areas of industry might be able to go it alone. 

Gibraltarians are generally politically savvy, lean away from extremist views, and are far more enthusiastic in support of their choice of party than most of their British counterparts.  But the average Gibraltarian's growing disenchantment with the European Union - stemming as much from the avalanche of Brussels-spawned directives and regulation as from the European Commission's (EC's) lacklustre approach to Spain's border violations - was reflected in the low turn-out in last month's European parliamentary election.  Fewer than one-third of the Rock's electorate voted - in a jurisdiction where local general elections draw percentage polls of 70 per cent or more, and are consistently higher than in most other western countries where voting is not mandatory.

Rightly or wrongly, there is a public perception that Brussels and Strasbourg are “on the other's (i.e. Spain's) side”.  And more recently - at least among those in business and finance who observe events in the EU with closer interest - this perception is being coupled with concern that the probable next president of the EC is Jean Claude Juncker - not only a federalist likely to uphold the status quo in any dispute between Gibraltar and Spain, but also a former prime minister of Luxembourg, a bitter rival of the Rock in the provision of financial services. 

So, the existing disenchantment is understandable.

Yet Gibraltar's continued economic success - which has allowed the Rock to weather the financial turmoil of recent years better than most other financial centres, big or small - depends on our continued membership of the European Union.  Our burgeoning financial services sector is based largely on Gibraltar's role as a stepping-stone for non-member states into the EU, with its potential market more than double that of the US.

Indeed, any British decision to quit the EU would cut the Rock's economic throat, for our membership - so frequently under fire from Spain - came and remains under Britain's umbrella, Gibraltar having become an EU territory when Britain joined in 1973 and forming part of the UK Member State.  Even any renegotiation of the UK's relationship with Europe could have an impact on Gibraltar's economic welfare.

Should Britain decide to quit the EU and Gibraltar applied separately for membership in her own right, almost certainly Spain would block that route.

Earlier this year, Gibraltar's Chief Minister Fabian Picardo suggested that if Britain left the EU, Gibraltar would “go it alone.” But in the same brief statement, he acknowledged that this goal might be impossible to attain.

"The snapshot is that it would be a disaster," the Chief Minister said.  "If we had to apply our minds to an economic model that might enable us to survive exit from the EU, it might be possible to design something where a lot of belt-tightening might mean that we might not actually disappear from the economic map.  But I think everyone in Gibraltar agrees that we don't want to even countenance that, because the short answer - that it would be disastrous - is actually the best way to represent what would happen."

Against this backdrop, the results of the recent European parliamentary elections are doubly ironic for Gibraltar. Not only has the South West constituency*, of which we are part, swung (along with many others) further towards UKIP, but the former Liberal MEP Sir Graham Watson lost his seat, and Sir Graham (one of the highest profile MEPs to go) was the staunchest of the Rock's advocates in the European Parliament and in the media.

The Chief Minister’s argument - peppered as it is with “mights” - that Britain's withdrawal would be “disastrous” for Gibraltar is sound, but may be overly bleak. There are some significant sectors of the economy where we could still hold our own on the international stage.

Across-border tourism would be hit, though impacted by the recent border queues and deliberate delays to traffic. However it is possible that the growing numbers of cruise-ship visits could compensate for this.

Our links with Britain would remain as would the close ties between our financial services industry and the City of London – though, here, as its own business lessened, we would feel the greater impact. 

And although our motor insurance sector would lose business from expatriates in Spain, it presumably would continue to account for a tenth of all British car-owners' cover. 

Similarly, our growing expertise in the international funds industry would stand us in good stead - while we would lose support from investors in EU countries, we would find other markets.

And this would apply to the economically significant online gaming industry, a sector already looking with some success to the lucrative sources of the Middle East and China.

Our Admiralty Courts (maritime courts) and bunker services - we're still the biggest supplier of fuel at this end of the Mediterranean - should also remain unaffected.

So perhaps we could survive a British exit from the EU? Yes. But only just...and at what cost? Gibraltar will continue to eye a possible UK referendum on Europe with some apprehension.

Michael Castiel is a partner at Hassans International Law Firm


*Formed in 1999 to replace a number of single-member constituencies, the South West was expanded to include the Rock before the 2004 elections.  This followed a European Court of Human Rights ruling that Gibraltar should be entitled to vote in European elections. A Spanish complaint against Gibraltar's participation was dismissed by the ECJ (European Court of Justice).

A year on from the Spending Review, the coalition's soothsayer has emerged to offer another gloomy economic prognosis. Asked by ITV News whether he could promise that there wouldn't be a double-dip recession, Vince Cable replied: "I can't do that.

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Anarchy in the UK(‘s) most famous fortress – part 2

Last week we left Gibraltarian workers fascinated by the beliefs of anarchists. Gareth Stockey, Chris Grocott and Jo Grady continue with the story.

The result was a noticeable increase in labour agitation on both sides of the frontier. The tactics adopted by local workers confounded local employers and the Gibraltar authorities, not least because anarchism proved remarkably successful at encouraging boycotts of businesses and ‘sympathy’ strikes in favour of fellow workers in disparate industries. When necessary, anarchists were also willing to adopt ‘direct action’ to combat what they perceived as the inherently violent practices of the bosses and local political authorities who protected them. The rhetoric of meetings gives us a flavour of this new-found militancy, with one worker threatening to ‘eat the liver’ of a local tobacco merchant during a strike in 1902. Following an earlier dispute in October 1901, a local anarchist newspaper urged its readers to remember the long-term goal of ‘total and definitive emancipation […] the abolition of private property with all its consequences, state, religion, militarism, magistrates […] a great work, larger than the massive Rock we have in our view’. Crucially, anarchists were willing to act as well as to talk. Several local bosses were assaulted during industrial disputes in the period – so much so that Gibraltar’s employers occasionally resorted to using firearms in self-defence – and ‘scab’ workers had stones thrown at them as they attempted to cross picket-lines.

Arguably what offended local businessmen more than the threat to their person was the very real challenge that anarchism offered to their economic interests. If we might dismiss as hyperbole, in the context of a heavily garrisoned British colony, the question posed by one local businessman to the Governor of Gibraltar in 1892, ‘are our goods and chattels safe?’, we can nonetheless point to several successes of anarchist militancy at the turn of the century. Across numerous industries, wage settlements favoured workers thanks to the effectiveness of strikes, boycotts and the occasional spot of physical intimidation. Most impressive of all, employers were forced to concede the dream of the ‘tres ochos’ (three eights) to many local workers – that is to say eight hours for work, eight hours for sleep and eight hours for leisure. Committed to improving living as much as working conditions, local anarchist groups also made up for the absence of state provision by offering schooling to hundreds of local children, as well as myriad cultural initiatives to bring learning to the local working classes.

Gibraltar’s employers were so shell-shocked by the growth and success of anarchism that they offered to pay the salary of a British union official who had been sent to the Rock in 1898. In his memoirs Lorenzo Quelch, who had been sent by the nascent Social Democratic Foundation, left a vivid account of his time in Gibraltar, but he decided not to take up the employers’ offer. The culmination of all of this activity was a ‘general strike’ of industries in Gibraltar in 1902. This time, having prepared meticulously and coordinated their response to the dispute, the employers emerged victorious. On the Spanish side of the frontier, the anarchist movement was to face worse, as the local political and military authorities staged a bloody massacre of local militants in October 1902, closing down workers’ centres and confiscating their funds.

Much work needs to be done, but this brief account of the infancy of labour organisation in Gibraltar highlights the intimacy of relations across the frontier. Many years later, in 1919, Gibraltarian workers would formally attach themselves to a British gradualist, rather than Spanish anarchist, form of organisation through the TGWU. But as we have noted, the Gibraltar TGWU retained strong links with its counterparts in the Campo for several decades and workers continued to fight side-by-side for better living and working conditions. The early successes of Gibraltarian and Spanish anarchists shows just how much workers on both sides of the frontier stood (and stand) to gain by recognising common grievances and acting collectively to address them.

Gareth Stockey is lecturer in Spanish studies at the University of Nottingham. He has published widely on the history of Gibraltar and Spain, including (with Chris Grocott) Gibraltar: a Modern History (University of Wales Press, 2010).

Chris Grocott is lecturer in Management and Economic History, and Jo Grady is lecturer in Industrial Relations and Human Resources Management, at the University of Leicester.