Territorial disputes: Gibraltar (Part 7) [Post 37]

Gibraltar, the egalitarian shared sovereignty and the financial system

The financial system presents much controversy. In TERRITORIAL DISPUTES, it is often the case that different parties will introduce very different financial realities.

Gibraltar, the United Kingdom and Spain are a clear example. The latest financial global crisis with still visible results in Spain and Brexit in the United Kingdom paint an uncertain future.

Assuming the three parties settled the dispute and decided to apply the EGALITARIAN SHARED SOVEREIGNTY, what financial system should apply in Gibraltar?

The possible choices that could be taken in relation to this financial system are many: a financial system anchored to one of the sovereign states, an independent financial system or one linked flexibly to both sovereign states.

As it is highly improbable that any of the sovereign states would agree to the third territory having its financial system anchored or linked flexibly to only one of them, these options are discarded for instrumental reasons—ruling out extreme options. However, it is possible that they would accept a more conservative scenario.

The egalitarian shared sovereignty states that the allocation of sovereignty is given by:

1. the equal right to participate (egalitarian consensus principle);
2. the nature and degree of participation depends on efficiency of accomplishing the particular objective/area/activity at issue (principle of efficiency);
3. each party receives a benefit (in terms of rights and opportunities) that depends on what that party cooperates with (input-to-output ratio principle); and
4. provided the party with greater ability and therefore greater initial participation rights has the obligation to bring the other two parties towards equilibrium (equilibrium proviso).

In the case of Gibraltar, there are several differences in relation to the financial system of the parties—e.g. strength of the currency, international credit rating, international debt, Brexit, etc.

As in all the previous elements and sub-elements, the shares of sovereignty are represented as bundles of rights and obligations, benefits and burdens. Therefore, all the parties have both the right and obligation to participate and support the financial system of the third territory (egalitarian consensus principle).

The EGALITARIAN SHARED SOVEREIGNTY will work in two ways:

• First, following the most efficient combination in relation to contributions (principle of efficiency): e.g., the currency of the third territory could be anchored to the strongest currency (input-to-output ratio principle) or anchored to a basket of other currencies.
• Second, as the application of the principle does not imply any investment from the two sovereign states in the third territory, the latter has no obligation to divide with them any internal or international revenues—unless a form of compensation was agreed, e.g. investments, exclusive privileges. There is efficiency in the financial system but without allowing any form of domination (equilibrium proviso).

What is specific to regulating the financial institutions is introduce next time when law as an element is analyzed. It may imply either the creation of a higher financial institution that regulates Gibraltar with equal representation granted to the three parties; or a procedure in which the financial institutions of the three parties will have the opportunity to be equally involved in the creation, amendment or cancelation of financial policy.

NOTE: This post is based on Jorge Emilio Núñez, “Territorial Disputes and State Sovereignty: International Law and Politics,” London and New York: Routledge, Taylor and Francis Group, 2020 (forthcoming)

Previous published research monograph about territorial disputes and sovereignty by the author, Jorge Emilio Núñez, “Sovereignty Conflicts and International Law and Politics: A Distributive Justice Issue,” London and New York: Routledge, Taylor and Francis Group, 2017.

NEXT POST: Gibraltar, the EGALITARIAN SHARED SOVEREIGNTY and government

Tuesday 26th November 2019

Dr Jorge Emilio Núñez

Twitter: @London1701

https://drjorge.world

Territorial disputes: Gibraltar (Part 6) [Post 36]

Gibraltar, the Egalitarian Shared Sovereignty, the financial system, government and law

Last time, we introduced the EGALITARIAN SHARED SOVEREIGNTY. Today, we present some key elements related to Gibraltar.

Post 35: Territorial disputes: Gibraltar (Part 5)

From our previous posts, we have learnt so far that some of the main concerns related to Gibraltar are:

Autarchy and financial system

Finance in the context of a sovereign conflict means the monetary policy, market system, taxation system and way of dealing with debts (internal or international) of a given State. 

Autarchy is the economic independence a State (in this case, a non-sovereign party, Gibraltar) must have in relation to other States; the ability a State has to balance its gains and losses without external aid.

The fact that a population is not able to meet its needs and has to appeal to its peers to achieve a certain balance in its account may militate against its sovereignty. It is not that autarchy is a necessary condition for a State to be sovereign. However, it is as a desirable feature in order to avoid any possible interference in internal affairs. 

In the particular case of sovereignty disputes, as in any conflict in which there are two sovereign States, it is more than possible that they do not have the same strengths in terms of their financial system. Gibraltar as a TERRITORIAL DISPUTE offers a clear example.

It is often the case sovereign States borrow large amounts of money. Even central States do so for very different reasons (e.g. to cover overdrafts in their expenses, to stimulate international trade, to soften bilateral relations). Therefore, the result is usually an unbalanced relationship that may result in different relative positions in any bargaining situation.

In the particular case of Gibraltar, it is easy to identify three parties with different levels of welfare. Although all of them have been affected by the recent worldwide financial crisis, the Spanish economy has evidently deteriorated. 

With Brexit, the United Kingdom’s future situation remains unknown. The financial system is a feature that implies much controversy, and so it will be analyzed through the proposed model. 

Therein, what financial system should Gibraltar have?

Government and law

The globe offers a wide spectrum of examples in which although the form of government differs, in all cases they are still States. There is no controversial feature at this point. 

In the particular context of this TERRITORIAL DISPUTE (Gibraltar), this sub-element does not offer controversy either. However, other sub-elements part of any government may not be so straightforward.

If sovereignty is not shared, then it is clear who elects representatives and chooses them (the inhabitants if the territory is independent or the inhabitants as part of a sovereign State). 

What happens when sovereignty is shared? Then, there are two different issues: 

a) representatives and administration; and 

b) law. 

It follows from this that the two most challenging practical issues raised by shared sovereignty in relation to government seem to be: 

• What sort of governmental arrangements shared sovereignty requires?; and
• How governmental authority can be shared and yet be workable?

NOTE: This post is based on Jorge Emilio Núñez, “Territorial Disputes and State Sovereignty: International Law and Politics,” London and New York: Routledge, Taylor and Francis Group, 2020 (forthcoming)

Previous published research monograph about territorial disputes and sovereignty by the author, Jorge Emilio Núñez, “Sovereignty Conflicts and International Law and Politics: A Distributive Justice Issue,” London and New York: Routledge, Taylor and Francis Group, 2017.

NEXT POST: we combine both (the EGALITARIAN SHARED SOVEREIGNTY and the elements mentioned above) to offer a potential ideal solution

Monday 25th November 2019

Dr Jorge Emilio Núñez

Twitter: @London1701

https://drjorge.world

Territorial disputes: Gibraltar (Part 5) [Post 35]

Gibraltar and the Egalitarian Shared Sovereignty

Time to solve Gibraltar. The last four posts introduced very briefly the background situation of this TERRITORIAL DISPUTE.

• Post 31: Territorial disputes: Gibraltar (Part 1)
• Post 32: Territorial disputes: Gibraltar (Part 2)
• Post 33: Territorial disputes: Gibraltar (Part 3)
• Post 34: Territorial disputes: Gibraltar (Part 4)

This series introduces TERRITORIAL DISPUTES and attempts to solve them as a matter of ideal theory. That means we conduct a theoretical experiment to evaluate what reasonable people would decide given some facts. 

When we addressed Kashmir, we centered the attention on population (religion, ethnicity, etc.). 

When it was the time to deal with the Falkland/Malvinas islands, we focused on territory (borders, natural resources, etc.). 

With Gibraltar, the analysis will be about government and law. That is because of two main reasons: a) Gibraltar has already taken the first steps towards a solution; b) by considering government and law, we complete the assessment of our current understanding in legal and political sciences of a “sovereign state.”

• Post 3: Territorial disputes: State and its elements. Population
• Post 4: Territorial disputes: State and its elements. Territory
• Post 5: Territorial disputes: State and its elements. Government
• Post 6: Territorial disputes: State and its elements. Law

Government can be defined as a person, group of people or body that create and apply the law for the population in a given territory. 

Together with population and territory, it completes the necessary elements that constitute a minimal political and societal organization. Government offers some controversial features in any TERRITORIAL DISPUTE. 

The following posts will review some of these features using the case of Gibraltar to show their implications.

The focus will be first on the financial system and later on specificities about power share. The main reason to proceed this way is because power sharing has many different implications, and amongst other sub-elements law. Thereby, and in order to have a clear picture it is advisable to deal with one issue at a time, review it, see how EGALITARIAN SHARED SOVEREIGNTY could be best realized.

REMINDER:

The allocation of sovereignty will be given by: a) equal right to participate (egalitarian consensus principle); b) the nature and degree of participation depends on efficiency of accomplishing the particular objective/area/activity at issue (principle of efficiency); c) each party receives a benefit (in terms of rights and opportunities) that depends on what that party cooperates with (input-to-output ratio principle); and d) provided the party with greater ability and therefore greater initial participation rights has the obligation to bring the other two parties towards equilibrium (equilibrium proviso). I call this way of dealing with sovereignty conflicts or disputes the EGALITARIAN SHARED SOVEREIGNTY.

Many questions are to be expected. Amongst them: How is that translated into Gibraltarian autarchy and financial system first?; b) how may it be possible to share power?

The next posts on this blog series about TERRITORIAL DISPUTES will cover these questions.

NOTE: This post is based on Jorge Emilio Núñez, “Territorial Disputes and State Sovereignty: International Law and Politics,” London and New York: Routledge, Taylor and Francis Group, 2020 (forthcoming)

Previous published research monograph about territorial disputes and sovereignty by the author, Jorge Emilio Núñez, “Sovereignty Conflicts and International Law and Politics: A Distributive Justice Issue,” London and New York: Routledge, Taylor and Francis Group, 2017.

NEXT POST (available on Monday 25th November 2019): Gibraltar, the Egalitarian Shared Sovereignty, the financial system, government and law

Friday 08th November 2019

Dr Jorge Emilio Núñez

Twitter: @London1701

https://drjorge.world