Spain's reliance on UK tourists shows just how interconnected Europe's economies are. Brexit threatens to undo all of this. It makes total sense for countries to start preparing for a worst-case scenario.
Spain will have a backup plan in place to shield its tourism industry from any disruption to air travel caused by Brexit regardless of the outcome of talks between the U.K. and the European Union, Deputy Minister for European Affairs Jorge Toledo said.
Airlines tend to make their flight plans one year advance, so Spain still has about four months to see if a back-up plan will be necessary, with the U.K. planning to leave in March 2019, Toledo said in an interview Thursday in Madrid. If the plan the EU is working on doesn’t come through, Spain will have one of its own so that U.K. tourists can keep coming, he said.
“If there isn’t an agreement, then we will have a plan B ready,” said Toledo, 52. “It would be necessary to work on a European solution but also on a national-based solution.”
With negotiations over Britain’s departure stalled, Spain is taking steps to protect a tourism industry that drew 18 million Britons last year. Ryanair Chief Executive Officer Michael O’Leary warned in August that airlines would be “screaming blue murder” next year if a wide-ranging deal on aviation isn’t reached to stop flights to and from the U.K. being grounded as a result of Brexit.
Rabobank estimates that the U.K. economy would lose about 400 billion pounds ($530 billion) in output through 2030 if the country crashes out of the EU without an agreement on its future trading relationship. Banks have so far led the charge in getting ready for a disorderly divorce that would probably result in tens of thousands of finance jobs relocating to the rest of Europe and billions in moving costs.
Spanish officials like Toledo are taking care to stress the importance of commercial links with the U.K.
While Spain fully supports the European Union’s chief Brexit negotiator Michel Barnier, a collapse of the talks would be disruptive in Spain because of the tourism and commercial links and the role played by Spanish firms including Banco Santander SA and Iberdrola SA in the U.K. economy.
Even so, the issue of Gibraltar, a U.K. enclave on the southern tip of the Iberian peninsula, remains a bone of contention.
Spain claims sovereignty over the territory and won a commitment from the EU to give it a role in shaping agreements over Gibraltar. Spanish ministers have suggested that they’ll seek joint sovereignty of the territory, which has been part of the U.K. since 1713 and wants to remain British.
Toledo said he hoped the U.K. would want to talk to Spain about what the agreement to exit the EU would mean for Gibraltar. So far, there has been no contact either with London on the issue, he said.
“We suppose that if Gibraltar and the U.K. are interested in applying some, part or all of the agreements between the U.K. and the EU after the U.K.’s exit — including the transitional period — they will let us know,” Toledo said. Even so, it would be natural to see what the agreement looks like before discussions begin, he said.
The EU stipulated earlier this year that the U.K. will have to engage in direct talks with Spain before any Brexit pact can be applied to Gibraltar.
Max Blain, a spokesman for U.K. Prime Minister Theresa May, said yesterday that her government is determined to get a deal that works for all parts of the “U.K. family.” “That deal must work for Gibraltar too,” he said.
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Photo credit: The beach in Marbella, Spain. The country welcomes millions of tourists from the UK each year. Michael Vadon / Flickr