Treaty and global instability are reshaping Rock’s future, Garcia says

Gibraltar is entering a new phase shaped by global instability, technological change and the UK/EU treaty, Deputy Chief Minister Dr Jospeh Garcia said in a budget address.

Dr Garcia said Gibraltar had changed profoundly since he first spoke in an appropriation debate in 1999, adding there was a clear lesson from successive periods of economic and technological change.

“Those who adapt prosper,” he said.

“Those who stand still fall behind.”

Dr Garcia said Gibraltar now faced a world marked by conflict, pressure on the post-war international order and rapid technological transformation, including the rise of artificial intelligence.

He told Parliament that Gibraltar could not afford to be “a prisoner of the past”.

“Nostalgia is not a strategy,” he said.

“It cannot become a substitute for policy.”

Much of his address focused on the UK/EU treaty, which he described as one of the most significant diplomatic achievements in Gibraltar’s modern history.

Dr Garcia traced the treaty’s progress from political agreement in June 2025 through publication of the full text on February 26 this year and approval by Parliament in March, before the formal approval of EU member states on July 1.

He said the treaty had been negotiated with the elected Gibraltar Government present “at every level” and said that fact was as significant as the text itself.

But Dr Garcia also reflected on what he described as the paradoxes at the heart of the treaty.

He said Gibraltar would end up with a closer practical relationship with the EU outside it than when it had been inside it, and would now develop a new relationship with Europe centred on goods, customs and Schengen, areas from which Gibraltar had been excluded during its time in the bloc.

He also said border fluidity would be greater outside the EU than it had been during membership, while Gibraltar would at the same time remain rooted in British sovereignty.

“Exiting the European Union has moved Gibraltar closer to the European Union,” he told Parliament.

Dr Garcia said Gibraltar would remain “the living example” that close European cooperation and British sovereignty were not mutually exclusive, describing Schengen as “a practical tool and not a political flag”.

“I have no doubt that students of Brexit in the future will find our journey a fascinating case study,” he said.

“Politics rarely produces perfect outcomes.”

“Sometimes it produces unexpected ones.”

Dr Garcia also turned to new border arrangements to reassure those concerned by the practical changes that will follow the treaty.

He said the border remained exactly where it had always been and stressed that sovereignty had not changed.

“Our sovereignty does not travel,” he told Parliament.

“It stays where it has always been.”

He said what would change were the practical arrangements for immigration and customs, with Schengen entry and exit checks moving from the land frontier to a new shared facility near the air terminal.

He also said Gibraltar would become “more secure than ever”, citing enhanced surveillance systems, new patrol capabilities, strengthened perimeter infrastructure and a joint operating base for law enforcement agencies.

Alongside the treaty, Dr Garcia used the speech to outline a wider view of Gibraltar’s place in a changing world, including its external action work, lobbying at the United Nations, political engagement in Washington and growing links with the Commonwealth.

He said the conclusion of the treaty would now free up time and resources for other international work, while also arguing that Gibraltar’s constitutional arrangements should reflect how far the elected Gibraltar Government had become involved in shaping the Rock’s external relations in practice.

Dr Garcia also highlighted the work of Gibraltar House in Brussels and Gibraltar House in London.

He said Gibraltar House in Brussels had played an important role through the Brexit process and treaty negotiations, supporting ministers and officials, building relationships with EU institutions and strengthening Gibraltar’s standing in Brussels.

He added that the office would now enter a new phase and would formally be renamed Gibraltar’s Mission to the European Union, reflecting Gibraltar’s status outside the bloc and its new treaty-based relationship with EU institutions.

Dr Garcia said the office’s future work would focus on monitoring EU legislative developments affecting Gibraltar and on engagement with the new governance structures created by the treaty.

In London, he said Gibraltar House had undergone significant transition while maintaining intensive political engagement in Westminster and Whitehall, particularly in relation to the treaty, parliamentary outreach and coordination with the UK Overseas Territories.

The speech also included updates on the Gibraltar National Archives, civil aviation, Parliament refurbishment works, restoration at The Mount and several ongoing tender processes.

Dr Garcia said the airport had developed a response plan following a spate of incidents involving unauthorised drone activity.

“That plan has already been tested successfully during real incidents,” he said.

“It has resulted in the airport being reopened in a quicker timescale on each occasion.”

“Work continues, in conjunction with the Ministry of Defence, to further mitigate the disruption caused by unauthorised drones.”