The Brexit is simply a portmanteau of "Britain" and "Exit". The British narrowly voted for the nation's exit from the European Union (EU). Over the coming months, perhaps years, the terms of how this departure will look will be negotiated. The actual departure will take years.
With UK PM David Cameron's announcement today that he will quit as of September, and that he will not be leading negotiations for the UK's withdrawal from the European Union (EU), the big question is who will lead negotiations ? Top UK brass were all in favour of remaining in the EU and it is likely that many will depart when Cameron does. The next UK Prime Minister will likely be from the 'Leave' camp. Thus Boris Johnson or Michael Gove would be serious contenders for the post.
Many suggest the process of withdrawal should wait until after the 2017 Presidential Elections in France to avoid Brexit becoming a major campaign issue. Others suggest leaving as soon as possible to mitigate EU uncertainty and stave off a copycat effect by other states. Today there are 2.9 million EU citizens living in the UK.
Here's how the Brexit will impact Britain :
Economy : The British Pound is at it's lowest level in decades and the UK economy will take time to recover. The EU is Britain's largest trading partner. EU trade tariffs and agricultural policy will need to be negotiated. These factors will impact inflation across the board. It is hoped that Britain will be able to negotiate a trade agreement similar to current terms, with favourable access to EU markets. In the short term, we expect a recession in the UK economy.
Global Markets : The Brexit has clearly caused market uncertainty across the globe. This uncertainty is likely to continue until terms of the negotiations are settled. For multinationals in particular, the Brexit will spell separate regulatory barriers and laws to consider when catering to Europe. Until now setting up a European office meant being able to plan for a single set of laws and rules for products and services.
Politics : The Brexit vote is likely to splinter both the ruling Conservatives and the opposition Labour parties. The Remain and Brexit sides cut across party lines. PM David Cameron has resigned, but we expect further disruption, and possibly an early General Election.
Migration : Britain being part of the EU enabled free movement- living and working - across the EU countries. There are 1.2 million Brits living in other EU countries, and around 3 million non-British EU nationals live in Britain. British resentment of EU immigrants from poorer, economically weak countries like Lithuania and Poland was the key motivator for Brexit. The government will be under pressure to overhaul the current arrangement.
UK's Future : The vote won by a narrow margin overall, however the Scottish voted to Remain by a much wider margin. Brexit has exposed differences of opinion over the EU in England, Northern Ireland, Scotland and Wales. Brexit has already spurred calls for an independent Scotland and a reunited Ireland.
At times like this, we wish we had a crystal ball.
Global Markets : The Brexit has clearly caused market uncertainty across the globe. This uncertainty is likely to continue until terms of the negotiations are settled. For multinationals in particular, the Brexit will spell separate regulatory barriers and laws to consider when catering to Europe. Until now setting up a European office meant being able to plan for a single set of laws and rules for products and services.
Politics : The Brexit vote is likely to splinter both the ruling Conservatives and the opposition Labour parties. The Remain and Brexit sides cut across party lines. PM David Cameron has resigned, but we expect further disruption, and possibly an early General Election.
Migration : Britain being part of the EU enabled free movement- living and working - across the EU countries. There are 1.2 million Brits living in other EU countries, and around 3 million non-British EU nationals live in Britain. British resentment of EU immigrants from poorer, economically weak countries like Lithuania and Poland was the key motivator for Brexit. The government will be under pressure to overhaul the current arrangement.
UK's Future : The vote won by a narrow margin overall, however the Scottish voted to Remain by a much wider margin. Brexit has exposed differences of opinion over the EU in England, Northern Ireland, Scotland and Wales. Brexit has already spurred calls for an independent Scotland and a reunited Ireland.
At times like this, we wish we had a crystal ball.
Brexit: UK Parliamentary Process
On Monday the UK Parliament will convene for the first time since the Brexit vote and David Cameron is expected to make a statement on the referendum. MPs will need to rescind the 1972 European Communities Act, which gives primacy to European Union (EU) law in the UK. Withdrawal will also involve the Parliament overseeing the reversal or amendment of over 80,000 pages of EU agreements that have been made over the past 50 years. Most of the UK's 650 MPs were in favour of Britain staying in the EU, but they will have to respect the decision made by the people.With UK PM David Cameron's announcement today that he will quit as of September, and that he will not be leading negotiations for the UK's withdrawal from the European Union (EU), the big question is who will lead negotiations ? Top UK brass were all in favour of remaining in the EU and it is likely that many will depart when Cameron does. The next UK Prime Minister will likely be from the 'Leave' camp. Thus Boris Johnson or Michael Gove would be serious contenders for the post.
Brexit: Timeline for Withdrawal
Technically, Britain could write the EU out of its laws immediately and ignore its obligations to the union. This is unlikely because it would make exit and future trade negotiations very difficult. The 'Leave Campaign' envision a period of informal discussion with EU member states to resolve key issues and come up with a realistic time frame.Many suggest the process of withdrawal should wait until after the 2017 Presidential Elections in France to avoid Brexit becoming a major campaign issue. Others suggest leaving as soon as possible to mitigate EU uncertainty and stave off a copycat effect by other states. Today there are 2.9 million EU citizens living in the UK.
Brexit: What Now❓
At 6am BST 24th June 2016, by a very narrow margin, it was confirmed that the UK had voted to leave the European Union (EU). The first thing to point out is that the UK leaving the EU does not come into effect immediately. The process will take several years.
Article 50 of the 2009 Lisbon Treaty : http://goo.gl/kzOGyoa formal legal process for withdrawing from the EU, will be invoked. The process will take a minimum of 2years and involves negotiation with member states. The only other nation to withdraw from the EU was Greenland in 1982. Once Article 50 is activated, the UK is cut out of EU decision-making at the highest level. The only way to reverse the withdrawal would be by unanimous consent from all EU member states.
The process of withdrawal involves negotiating with the remaining 27 EU members and final terms need to be agreed upon by qualified majority. The European Parliament has a veto over any new agreement formalising the relationship between the UK and the EU.
Article 50 of the 2009 Lisbon Treaty : http://goo.gl/kzOGyoa formal legal process for withdrawing from the EU, will be invoked. The process will take a minimum of 2years and involves negotiation with member states. The only other nation to withdraw from the EU was Greenland in 1982. Once Article 50 is activated, the UK is cut out of EU decision-making at the highest level. The only way to reverse the withdrawal would be by unanimous consent from all EU member states.
The process of withdrawal involves negotiating with the remaining 27 EU members and final terms need to be agreed upon by qualified majority. The European Parliament has a veto over any new agreement formalising the relationship between the UK and the EU.
David Cameron’s Replacement
UK Prime Minister David Cameron may be replaced by Boris Johnson or Michael Gove after the PM announced that he would be stepping down in a few months. Gove is being called the brains behind the Brexit strategy but Johnson seemed the most probable replacement to David. If so, Gove could choose to become Chancellor and lead the negotiations on Brexit.
However, Home Secretary Theresa May was being discussed as a likely anti-Boris candidate and is being favoured by Cameron’s men at Westminster, to try and unify the party. Theresa is discussing the launch of a rival ticket with Liam Fox who is extremely against the EU. Unfortunately, many MP’s, especially Tory women, don’t consider her a ‘team player.’ During his victory speech on Friday, Johnson said that Britain could have a ‘glorious future’ outside the EU and that it didn’t mean it had to sever ties with the continent.
