All negotiations with Spain for a Commercial Treaty have for
the moment broken down, and the relations between that country and Great Britain have become a little strained. Lord Granville asked that, as a preliminary to a treaty, England should be admitted to the benefit of the " most-favoured-nation " clause, to which she considers herself entitled, promising in return stricter regulations to prevent smuggling from Gibraltar; and ultimately, when the treaty is framed, a reduction of the wine duties. The Spanish Government, however, regaxd this smuggling as a grievance which should be stopped without waiting for treaties, and wish to treat the "most-favoured-nation " clause as part of the price they are to pay for a commercial treaty. They are right about the smuggling, or would be, if they did not affect to consider us only in military occupation of Gibraltar ; but their conduct about the most-favoured-nation clause is just a little too" 'cute," and Lord Granville, therefore, replied on August 1st that he considers his proposals rejected, and that "the manner of their rejection betokens on the part of the Spanish Govern- ment a want of appreciation of the friendly and cordial spirit in which her Majesty's Government were desirous of approach- ing the subject." Further discussion would therefore, in his judgment, be "inopportune." This is not a satisfactory state of affairs, but if the Spaniards held the Isle of Wight aud per-. mitted smuggling, we should be irritable and grasping too.
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