Pelagos data centre must meet Gibraltar’s economic, environmental and EU-alignment priorities

By Nick Calamaro

The £1.8 billion Pelagos Data Centre project represents the single largest foreign investment in Gibraltar's history. The government deserves credit for actively seeking to diversify our economy beyond traditional sectors and into high-growth areas.

But by focusing on potential revenue for Gibraltar alone, and by refusing to share more details about the deal, we are once again being told to trust politicians, rather than in a shared, sustainable vision for Gibraltar’s future.

Sir Joe's comment in a recent interview that Gibraltar is "a lump of limestone which produces nothing" deserves pushback. Gibraltar doesn't produce nothing. We produce tremendously educated, highly skilled workers. Look at Switzerland, Singapore, or Hong Kong. These jurisdictions have generated tremendous wealth through services despite having few natural resources. What do they have that we don't? They've made massive, sustained investments in their people and in job creation, not just in attracting revenue.

One need look no further than Gibraltar's legal sector to see that those kind of services are possible here. We've built a world-class legal industry (with tremendous support from government) that punches well above our weight. Our lawyers are educated to the highest standards and compete globally. That's the kind of success we should be aiming to replicate across other sectors, and which the government should be putting just as much time into. Gibraltar should never have to rely on whatever foreign investment comes knocking, regardless of whether it aligns with our values.

Despite our GDP, too many Gibraltarians are stuck in low-wage jobs with no room for growth. Too many are on zero-hour contracts with no job security. And too many are forced to find careers abroad because the opportunities here simply don't exist. This isn't because Gibraltar "produces nothing." It's because we haven't invested enough in creating the quality jobs and career pathways our workforce deserves.

Quality jobs do more than provide individual livelihoods. When professionals earn good salaries, they spend money in local businesses, use support services, pay income taxes, and start their own ventures. It also builds the kind of dynamic economy that can actually adapt when circumstances change. Resilience we desperately need as evidenced by the hole that we now need to fill based on the UK’s changes to remote gambling taxation.

All this is why the lack of detail around the proposed data centre is so concerning. Beyond the headline investment figure, the public needs answers on fundamental questions. Will this create meaningful employment for Gibraltarians, or just a handful of specialised roles? Will any local jobs be long-term, or tied to a construction phase that ends once the data centre is operational? And more broadly, what are the environmental implications, the ownership structures, and the long-term viability of betting on AI infrastructure?

The Environmental Safety Group has already flagged the enormous energy and water requirements for data centres. Pelagos has pledged renewables, but the current plans rely on LNG. Beyond the carbon footprint, there's the question of betting Gibraltar's economic security on AI infrastructure when the valuations for AI firms has risen far beyond even the most optimistic possible returns. We need to make sure Gibraltar isn't left holding stranded assets when the market invariably turns.

In terms of ownership, all we know about Pelagos is that it is being led by Konstantin Sokolov, an American billionaire who has donated millions to Donald Trump. With Trump threatening to annex Greenland and showing active contempt for European democracies, we have to be incredibly careful about what kind of business we're attracting to Gibraltar. More than that, the EU is finally seeing the urgent need to divest itself from American tech monopolies that go against our values and which could hand our data over to the US government without our consent.

Gibraltar has always stood with Europe on the principles of freedom, sovereignty, democracy, and human rights. For eight years, we've been stuck at a crossroads, thrust out of the EU against our will. But with a treaty finally in striking distance, now is the time to choose what kind of partner we want to be to Europe. That choice means being transparent about the industries we attract and the investments we pursue.

Sustainable, transparent investments are possible. Just across the border, Spain is making exactly the kind of EU-aligned investments we should be learning from. The Campo de Gibraltar is seeing major initiatives, not just in physical infrastructure, but in jobs and training programmes, particularly in renewable energy and technology.

Thanks to Spanish government efforts, Moeve (formerly Cepsa) has already invested over €3 billion into a Green Hydrogen Hub, split between San Roque and Huelva. A forward-thinking project that aligns directly with Europe’s plans for independent, renewable sources of energy and which will create real economic opportunities for local workers and new arrivals.

These investments in the Campo are sure to attract further investment, create quality jobs, generate revenue for public services, and build capacity for future growth. When the Campo is investing in its people, in training, in skills development, Gibraltar should be learning from and building alongside these efforts.

The government's drive for new revenue sources and economic diversification is welcome. Foreign investment is welcome. But Gibraltar doesn't produce nothing. Gibraltar produces exceptional people. It's time our economic strategy reflected that.

Nick Calamaro is the leader of Together Gibraltar.