Merkel hopes Spain's Brexit deal objection can be resolved by Sunday

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With wrangling continuing on issues including Gibraltar and fishing rights, European Commission Vice-President Valdis Dombrovskis said Wednesday that the political declaration on future relations was "not there yet".

The draft agreement reached last week triggered an avalanche of criticism in Britain and left May fighting to keep her job even as British and European Union negotiators raced to firm up a final deal before a summit on Sunday where European Union leaders hope to rubber-stamp it.

Yesterday Pedro Sánchez, the Spanish prime minister, threatened to derail the Brexit withdrawal treaty...

"I hope that the DUP and the others will look at the details of the deal and see this is the right way forward for the country, given the damage that would be done to us as a country were we not to have a deal, or were we to find that the referendum result couldn't be delivered", he said.

"Both documents have to be finalized by Sunday so that we can sign the exit agreement, and accept the statement on the future relationship", she told lawmakers.

"It should be negotiated between Spain and the UK".

The BBC's political editor Laura Kuenssberg said some United Kingdom ministers still believed there was time for a few "nips and tucks" to the withdrawal agreement reached in principle last week.

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Last year's European Union guidelines on the Brexit negotiations effectively gave Spain veto powers over future relations between the bloc and the British overseas territory, and the Spanish government says it will vote against the Brexit deal if Gibraltar's future isn't considered a bilateral issue between Madrid and London.

In the Spanish Congress, the PP's Jose Ramon Garcia launched a vitriolic attack on Foreign Minister Josep Borrell, who he said had conducted "a bad negotiation" and was "not up to it".

"We no longer have a functioning government".

But Mr Borrell dismissed the criticism and said all the agreements relating to Gibraltar were now in place, adding that Spain's only concern was in relation to negotiations for the future relationship.

The veto threat has prompted outrage in London with accusations the Spanish government is trying to blackmail Britain.

The PM said she was pleased that the UK had agreed a protocol on Gibraltar that would form part of a wider package of agreements between the UK, Spain and the Government of Gibraltar setting out the parties commitment to co-operation.

"The UK wants free movement of goods, which they won't get because that's back to discussing partial access to the single market, which we don't do", the person said.

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Spain wants May to cut a special deal on Gibraltar and not to include the territory within the overall future partnership deal.

Within the European Union, a withdrawal treaty is adopted by qualified majority and not unanimity, so formally a single state like Spain can not block it.

In his first public comments since last week's draft agreement on Britain's withdrawal from the EU, Carney also confirmed that the Bank of England would publish next week its assessment of the deal and also what would happen if Britain crashes out of the EU with no deal.

After Tuesday's meetings in Madrid, the Gibraltar Government said the memorandums and the tax agreement were now complete "subject only to text stabilisation, legal checks and minor clarifications".

The Chief Minister has convened an extraordinary meeting of the Cabinet on Thursday morning to brief ministers on latest developments.

"This isn't going to get better", she told a committee in Parliament.

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