How to sell a diplomatic failure as a success

The Foreign Secretary had expected to be in Madrid yesterday, trying to meet the Government's self-imposed "summer" deadline for agreement with Spain over the future of Gibraltar. Instead, he found himself no further from home than the House of Commons, where he drew a furious response from the Opposition and an even more furious one from the first minister of Gibraltar with a statement that contained almost nothing new.

What generated the excitement was Jack Straw's bald articulation of the shared sovereignty principle to assembled MPs. It is one thing for government officials to talk to select committees or journalists about sharing sovereignty over a territory that has been British for almost 300 years; quite another to hear the Foreign Secretary say so formally to the House.

Yet the real significance of Mr Straw's statement was its absence of novelty. There was no need for either the Tories or the Gibraltarians to cry "betrayal". Quite simply, he was trying to "sell" a diplomatic failure as a success. While hailing an agreement "on a number of principles", Mr Straw was actually saying that he had abandoned all hope of reaching agreement with Spain "by the summer". He and the Spanish have not reached agreement on, among other things, the future of Britain's military bases and whether a sovereignty agreement should be final – as the British insist – or the prelude to a handover to Spain.

That Mr Straw's statement was a mere marking of time, however, was clearest from his reiteration of the most divisive principle of all: that Britain will share sovereignty over the Rock only if the people of Gibraltar approve it. This is, to put it mildly, not on the cards. Agreement may well have to wait now until Gibraltar feels the harsh winds of economic reality, as it will surely do when the colony's tax haven status ends. In the meantime, Spain should recognise that it has won the sovereignty argument in principle and desist from all harassment. Only law-abiding civility from Madrid has the slightest chance of persuading Gibraltarians that shared sovereignty will not be the alien rule they so fear.