Since I urged the Virgin Islands government to prepare for Brexit in the Jan. 30 edition of the Beacon, the United Kingdom’s Parliaments Withdrawal Agreement Bill (WAB) has become the Withdrawal Agreement (WA), an international treaty between the UK and the European Union, and Brexit appears to have been done.

However, sabre rattling on both sides has increased the possibility of the UK crashing out without a deal on Dec. 31. Moreover, Brexit has made citizens of one British overseas territory more fearful for its future, with possible consequences for the rest of us.

It is even more urgent that the VI government devote some time and human resources to studying the possible disadvantageous outcomes for the VI of a hard Brexit at the end of this year. The territory should utilise the UK’s loan guarantee before the money markets sense the uncertainty created by an increased chance of a hard Brexit, leading to a significant drop in sterling’s rate against the United States dollar.

The WA sets out certain areas of UK law within which the European Court of Justice will remain superior to UK courts, yet UK Prime Minister Boris Johnson appears already to have repudiated that commitment by declaring that the UK would not be subject to the authority of EU courts after the end of this year. As with his probably unsustainable guarantee of frictionless trade across the Irish Sea, he will have to choose between postponing the date for completing the UK’s divorce from the EU by Dec. 31 or crashing out without a deal, followed by court action for breaching the WA.

 

Spain and Gibraltar

Before Brexit, the Spanish government didn’t expect an early restoration of its sovereignty over Gibraltar, which was ceded to the UK under the Utrecht Treaty of 1713, but sought some special agreement that would at least partly remove from its border a tax haven that is largely supported by online gambling, offshore banking and duty-free shopping. However, Gibraltar’s chief minister warned the UK of Brexit’s threat to Gibraltar’s safety. Now that the UK is no longer a member country, the EU supports Spain’s territorial claims over Gibraltar by excluding Gibraltar from any trade deal with the UK unless Spain explicitly agrees — after resolving its differences with the UK in bilateral talks.

Gibraltarians were the only British OT citizens able to vote in the 2016 Brexit referendum, when 96 percent of their votes supported remaining in the EU, so they feel that the EU has let them down. During the run-up to the previous deadline for Brexit — Oct. 31, 2019 — the government of Gibraltar distributed to every Gibraltarian household and business a booklet produced by its deputy chief minister and minister for Brexit detailing its contingency planning for either preparing to leave the EU with an agreement or mitigating possible disruptive effects of a “no-deal” Brexit.

 

Brexit booklet

The government of Gibraltar worked closely with the UK to examine the potential effects of a no-deal Brexit on how people and goods might cross the land border. The document explains that rights the EU will give to UK nationals and businesses will not directly apply to them as well. In planning how it would manage to cope with the situation if the UK and Gibraltar left the EU without an agreement, it considered a “reasonable worst-case scenario (RWCS).”

Gibraltar’s population is about the same size as the VI’s, but occupying under three square miles. The RWCS foresees systematic Spanish land border checks creating daily Gibraltar-wide traffic congestion, so the emergency services must prepare for at least one major incident occurring. Imports requiring sanitary and other checks would need to come in by sea, as the land border inspection posts are not appropriately designated for them.

Workers living in Spain would encounter difficulties during the peak periods and longer-term their retention may need to be considered, while following Brexit there will probably be fewer Gibraltar-based citizens travelling to and from Spain for routine business and leisure, and many Gibraltarians living in Spain may want to relocate to Gibraltar, increasing pressure on some government services (e.g. the Housing Department).

 

In the VI

Those are just some of the results of Brexit foreseen under the RWCS. Considering the devastation the VI experienced during Irmaria and subsequent patchy recovery, our government should emulate this approach by gathering and assessing all Brexit-related information possibly impacting on the VI and keeping the public informed and reassured about relevant developments.

Premier Andrew Fahie deplores the VI’s loss of associate status after Brexit, which deprives us of future EU funding, but in a RWCS, antagonising the EU into blacklisting the VI for non-regulation of its cryptocurrency exchanges might also lose us rights within the Caribbean we have taken for granted, like freedom of movement within Dutch and French territories that are backdoors to the EU.


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