The ink has yet to dry on Theresa May's Article 50 signature from last week which officially started the UK's 2-year long divorce from the EU, and already Europe has been traumatized by comments from former Conservative leader Michael Howard, who suggested that Theresa May is be prepared to go to war to protect Gibraltar as Margaret Thatcher once did for the Falklands, comments which according to the Guardian were "immediately criticized as inflammatory."

Howard told Sky News on Sunday that: "There is no question whatever that our Government will stand by Gibraltar... 35 years ago this week another woman Prime Minister sent a task force half way across the World to defend the freedom of another small group of British people against another Spanish-speaking country.... I am absolutely certain our current Prime Minister will show the same resolve in standing by the people of Gibraltar."

As The Telegraph adds, Howard said the British Government will stand by Gibraltar during Brexit talks amid claims of an EU “land grab” for the territory by Spain. It came as Spain confirmed that it would not initially block an independent Scotland's attempts to join the European Union (EU). Alfonso Dastis, Madrid's foreign minister, reportedly said Spain would not veto an independent Scotland's EU hopes - while stressing he does not want to see the country leave the United Kingdom.

Aerial view of Gibraltar

A European Council document on Friday suggested that Spain will be given an effective veto on whether the Brexit deal applies to Gibraltar. Downing Street said May had called Fabian Picardo, the chief minister of Gibraltar, on Sunday morning to say the UK remained “steadfastly committed to our support for Gibraltar, its people and its economy”.

Taking British officials by surprise, the draft guidelines drawn up by EU leaders state that the Brexit deal will not apply to Gibraltar without an "agreement between the kingdom of Spain and the UK". One official told The Telegraph it is "absolutely unacceptable" and gives Spain too much power over the future of Gibraltar.

In response, on Sunday the Prime Minister told Gibraltar's chief minister that Britain will never allow Spain to take over the peninsula against its will. Sir Michael Fallon, the Defence Secretary, has also pledged to "protect" Gibraltar "all the way". Speaking to the BBC's Andrew Marr show, Fallon said: "The people of Gibraltar have made it clear that they don't want to live under the sovereignty of Spain. Gibraltar is going to be protected all the way."

"The Rock", a British Overseas Territory since 1713 with 30,000 residents, remains a major source of diplomatic tensions. Gibraltar's chief minister has warned the territory should not be used by Spain as a bargaining chip for Britain’s Brexit negotiations.

Fabian Picardo told the BBC this morning that sharing sovereignty with Spain would be "absolutely awful" and comparable to "living in somebody else’s land." He said he was "working closely with the British Government" and he would support the British Prime Minister in the upcoming negotiations to get the best deal. "I am sure the UK will be batting for Gibraltar," he said. "Gibraltar is not on the table as a chip".

On Sunday, May told Mr Picardo that the UK is "absolutely dedicated to working with Gibraltar for the best possible outcome on Brexit", Downing Street said. Quoted by The Telegraph, a May spokeswoman said Mrs May "reiterated our long-standing position that the UK remains steadfastly committed to our support for Gibraltar, its people and its economy".

"The Prime Minister said we will never enter into arrangements under which the people of Gibraltar would pass under the sovereignty of another state against their freely and democratically expressed wishes, nor will we ever enter into a process of sovereignty negotiations with which Gibraltar is not content." "The Prime Minister said we remain absolutely dedicated to working with Gibraltar for the best possible outcome on Brexit and will continue to involve them fully in the process." Last night Boris Johnson, the Foreign Secretary, said that the UK’s support for Gibraltar will remain “implacable and rock-like”.

Elsehwere, when asked about the controversy surrounding May’s apparent threat to weaken security cooperation if Brexit talks turn sour, Defense Secretary Fallon said the negotiations had to cover both a trade deal and issues such as counter-terrorism and police cooperation. “It is very important to link trade and security because what we are now looking for is a deep and special relationship that covers both economic and security cooperation. Those two things go together,” he said.

“It is very important that we go on committed to the security of the continent.” Fallon then talked about sending 800 troops to Estonia, others to Poland, and RAF Typhoons to Romania, which are all under Britain’s Nato commitments not linked to EU membership. “We are stepping up security because it remains our continent and this is a very uncertain time for Europe and right we should be playing our time on that. We’d all be worse off if there wasn’t a deal – we are expecting to have a deal.” The defence secretary admitted some issues were inside the European treaties, and others (including Nato) not. “The letter refers to our ambition to have a completely new partnership on the economic side but also on security side,” he said, arguing that stating a fact about defence capabilities wasn’t a threat.

Meanwhile, the reaction in Gibraltar to the latest territorial posturing was quick. According to the UK's Express.co.uk, the newspaper spoke to a host of Gibraltarians who are all adamant about one thing: there is nothing anyone could do to undermine their sovereignty as a proud nation: "one thing is very clear - people in Gibraltar are happy for Britain’s support, but said they can handle this on their own."

Justine Rovegno said: “I think Gibraltar would be more prepared to relocate its entire population before we would let Spain take-over, we are an extremely stubborn community!”

Manuel Gracia added: “If Spain takes military action we'd stand our ground and I’m sure we’ll be helped by the UK." “If the EU cuts Gibraltar out of any deals and trade like I said Gib will stand it's ground and look to other opportunities. "

“As far as I'm aware there's always been talk of Spain ‘taking Gib back’ with force, politics and pretty much every way you can think of. None of it has worked so far and I find it doubtful that it'll come to that. There will be tensions. There will be arguments but that's what it's always been like.”

Danielle Barclay took a more blunt stance, referring to the actions of Spain and Donald Tusk as being: “F****** disgusting and inhumane.”

As Express adds, "the population of Gibraltar seems relatively unfazed by the prospect of a Spanish invasion, EU strong arming and political scheming and are confident they have seen it all before and will come out of this stronger - as they always have."

But there is an ominous sense of dread about what is to come, as Justine said: “I think the Gibraltarian community has survived very dark times because of Spain, I think most of them believe they have gone through the worst, and Spain going about this in such an intimidating way is just fuelling a fire that was lit many years ago. “I felt that the younger community was learning that there was not a giant brick wall between Gibraltar and the Spanish, but I think the angst they are creating is slowly putting those thoughts back into everyone's minds which is extremely sad.”

Not even one full week into Brexit, and nationalistic tensions - the continent's soft spot - across Europe are once again rising, this time not the direct result of Europe's refugee troubles. The good news: for now it is being handled diplomatically. The bad news: as the following chart from Goldman shows, the Brexit process is just beginning, and the potential for political and economic complications will only eventually be fully appreciated.