The ‘Brexit’ effect on the Costa del Sol - El Sol Digital
The ‘Brexit’ effect on the Costa del Sol

The ‘Brexit’ effect on the Costa del Sol


The exit of the UK from the EU will have an impact on tourism, investment, exports and also on the lives of more than 50,000 residents in the province. The most important impact will be felt in the medium term and will depend on the terms set for separation.

The only good news is that most of the summer holidays have already been arranged and people are unlikely to change their plans. It is therefore unlikely that ‘Brexit’ will not have much impact during the upcoming tourist season. However beyond the summer months uncertainty lies ahead. The relationship between the two countries began when Spain was yet to be a democracy and England was preparing to join the European Union.

That relationship began in tourism and some of those who had come to enjoy a few days in the sun began to see the Costa del Sol as a destination to stay and live. For those who came here to retire the price of the pound gave them the purchasing power. Residential tourism also emerged and all the industries that grew around them. The exodus continued as new technologies extended the possibilities of working remotely. The economic crisis generated a migratory movement back of a certain number of people however the British living in the province are more than 56,000, according to the latest statistics, and not all are pensioners. In fact, 9,055 British workers are paying into the Spanish Social Security system in the province of Malaga. 20 percent of British residents in the province live in the town of Mijas and another 35 percent is split between Fuengirola, Benalmádena, Estepona and Marbella. The British are not only living on the Costa del Sol. Alhaurin el Grande is number 6 on the list out of the towns with the most British residents, who are present in 96 of the 101 municipalities Malaga.

The influence of Britishness in social, economic and cultural life in the province which reaches beyond tourism includes the 16 schools providing instruction in English where most of its students are from British families.
The first effects of Brexit have already occurred with the sharp drop suffered by the price of the pound which will result in a lower purchasing power of the British tourists, currently the biggest spenders in the province of Malaga, and also could lead to fewer travellers to the region.

A similar effect can be expected on investments on the Costa del Sol with regards to real estate projects aimed mainly at the UK market and supported financially from the ‘city’ London, which might possibly lose its clout as the epicentre of European finance. Similarly, agricultural exports from the province to the British market might be affected by the weaker pound and any restrictions placed on the free movement of capital and goods.
The networks of small and medium enterprises aimed at the 56,000 British residents on the Costa del Sol, could lose purchasing power to the extent that their income depends on the price of sterling.

The bureaucracy

The concerns of British residents in the municipalities in the province of Malaga cover all fields: administrative, health, fiscal, economic and even political rights.
When the time comes that the UK is no longer a member country of the European Union, a process that will culminate in two years with the signing of Article 50, the British in Spain will cease to be community residents. It remains to be seen what agreements are put in place between the two countries and the fate of those already living in Spain and those who wish to come to Spain after the exit. In terms of employment restrictions might be placed whereby community members and Spanish are favoured over the British.

Health is another area which is a concern for British residents who might lose their European health insurance card. Although all persons registered in Spain are entitled to health care in the public system, the situation for pensioners is cause for uncertainty. There could be an end to ‘health tourism’ by people who have travelled from the UK to receive treatment although this is a residual phenomenon when compared with the volume of tourists visiting Spain. Health care for tourists is another point to be set by a treaty.

Pensions might be affected as currently they rise with inflation as UK pensioners are currently members of the European Union however leaving the EU could result in those pensions being frozen as in the case of Canada. Again it will depend on agreements being reached between the two countries but a freeze in pensions would mean a lower spending power.
In terms of political rights, the British residents of the Spanish municipalities currently have the right to vote and to be elected in municipal elections as citizens of the European Union. They can only preserve this right if Spain and the United Kingdom signed a reciprocity agreement as it currently has with Norway, Ecuador, New Zealand, Colombia, Chile, Peru, Paraguay, Iceland, Bolivia, Cape Verde, Republic of Korea and Trinidad and Tobago.

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