By Katya Adler BBC correspondent in Madrid

An extra glass for Gibraltar?

Gibraltar, he said, would be invited to attend future discussions, but warned a long-term solution on the Rock's sovereignty was not yet in sight.

Mr Straw was speaking in the Spanish capital, Madrid, after meeting his counterpart, Miguel Angel Moratinos.

The Spanish foreign minister praised what he described as his "good friend Jack's" openness.

The only way to move forward is on the basis of democracy and consent Jack Straw

The words were warm but both countries' positions remain firm.

Mr Straw complimented his Spanish counterpart on his willingness to co-operate but the battle lines were as clear as ever.

Spain refuses to renounce its claim on the sovereignty of Gibraltar while Mr Straw insists Britain will not negotiate without the Gibraltarians' consent.

'Delighted'

"We will always honour the wishes of the people of Gibraltar as to their future, so unless they are fully able to participate, there's frankly little point in having the discussions," said Mr Straw.

"This is a very, very difficult issue for the people of Gibraltar. It's also a difficult issue for the people of Spain. The only way to move forward is on the basis of democracy and consent."

But some progress was made during the bilateral meeting.

Spain promised to improve relations with Gibraltar on a regional and local level.