SPAIN has made a blistering attack on British sovereignty over Gibraltar, signalling a sudden cooling of relations between Madrid and London.

 Josep Pique, the Foreign Minister, told the Spanish Senate Gibraltar was an "economic parasite which, far from being productive, lives off Spain". The attack came without warning and generated acute concern in London. Foreign Office officials took more than 16 hours to issue a response.

 A statement said: "The UK has made clear that it has attached importance to keeping open all our channels of communication." But Whitehall sources said there was shock at the suddenness of the attack, only a fortnight after talks between Robin Cook, the Foreign Secretary, and Mr Pique.

 The relationship with Spain's conservative administration is seen as central to Government attempts to liberalise European Union economies. Mr Pique said the colony was "a gigantic duty-free shop" and was a "dead weight, difficult to support" in relations between Spain and Britain.

 Spain's restrictions on Gibraltar would remain in place, he added. The remarks were the strongest anti-British statements from the ruling Popular Party party since it was elected five years ago. The timing suggested a carefully staged move by an embattled government.

 A Spanish Foreign Ministry spokesman said several factors, including public concern over the nuclear submarine Tireless, in Gibraltar awaiting repairs, lay behind them. He said: "At the last meeting we had with the British, they did not seem interested in the Brussels process in which it was agreed to discuss the future of Gibraltar.

 "We have been more than loyal to the British over Tireless and we cannot understand why they have not been loyal to us over this. There is mounting public pressure over Tireless and people are becoming fed up." Spanish governments since Franco have wheeled out the Gibraltar issue to rouse populist sentiment and deflect criticism in times of trouble.

 The government of Jose Aznar, the Prime Minister, has come under attack almost daily for its allegedly soft approach over the Tireless. Having presided over a period of economic prosperity and growth, it is now under fire from a revitalised opposition over a number of issues.

 These range from mad cow disease to scandals involving flax and olive oil producers fraudulently claiming millions of pounds in EU subsidies. The warm relationship between Mr Aznar and Tony Blair was built on their shared goal of greater economic liberalisation in the EU.

 The new hostility could make the summit on economic reform in Stockholm in four months' time a difficult occasion. Mr Pique said future co-operation with London over Gibraltar, which was ceded to Britain in perpetuity under the 1713 Treaty of Utrecht, would take place only "in the context of sovereignty negotiations".

 Peter Caruana, Chief Minister of Gibraltar, said the statement was "highly subjective . . . and factually inaccurate and all in all a very hardline statement of a very hardline position".