Madrid’s leaders continued desperate attempt to claw back Gibraltar by demanding a veto over the future relationship between the EU and Gibraltar as Britain leaves the bloc, which was granted.
“This seems intended to give Spain something so they don’t try to hold the whole withdrawal treaty hostage over it,” one senior EU diplomat said in Brussels.
The majority of Gibraltarians voted to Remain in the European project, as they fear being punished with closed borders and customs checks by Madrid.
Mr Garacia-Margallo said: “If you want to be part of the European Union, the internal market and so on you have to have a member state which is responsible for the foreign affairs of Gibraltar.
A former Spanish minister threatened Gibraltar Spain could 'isolate' the Rock during Brexit talks
Either you want to be completely isolated or you want to be part of the European Union
Jose Manuel Garcia-Margallo
“It’s for the Gibraltarians to decide; either you want to be completely isolated or you want to be part of the European Union.
“What we are offering them is quite a smart and generous offer.”
Fabian Picardo, Gibraltar’s first minister, blasted the EU for allowing Spain the opportunity to hold the Rock ransom during the Brexit talks.
He said: “It is true many of us did not expect the European Council to avail Spain of an ally in the process of confecting the shopping list put to the United Kingdom.”
Mr Picardo did, however, hint Madrid’s demands would probably not survive the two-year negotiation period.
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A local businessman has called on the UK and Brussels to come to an agreement to save the local economy.
Tony Watkins said his firm relied on tourists being allowed to come across the border, something Spain may target if they don’t get their own way.
He said: “Worst case scenario shut the border, and then we would be in a lot of trouble – we would have to make a lot of staff redundant.
Things you may not know about Gibraltar Mon, April 3, 2017
Gibraltar is a confusing place, especially if you have never been yourself
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Gibraltar has its own political system that makes many decisions within the territory but issues like defence and foreign affairs are determined by the UK Government in London
“Obviously we’d still have tourists come in here but not enough to run a massive business like ours has evolved into.”
Mr Picardo demanded the support of the UK Government after Thursday’s General Election.
“Stand by the Rock,” he said. “Voters in the United Kingdom would have something to say if a political party in the UK suggested it was not going to stand by the Rock.”