With the vote of being made official for Britain’s exit of the EU, it’s time to reflect on the short and long term effect that this will have on Britain and the wider world. Immediately after a definite Brexit victory was known, David Cameron resigned as Prime Minister with a successor being placed by the start of the Conservative conference in October, of which the new PM will be left with the task of triggering Article 50. However, EU leaders are adamant in Britain initiating their exit process “as soon as possible” in order to end uncertainty of the future of the EU.
The Article itself extends to two years for the leaving country to exit the EU and after this period the treaties that were in effect during membership will no longer apply. The specific conditions for the exit will be negotiated between the remaining 27 EU member states who will each have a veto over the terms. Conversely, establishing new trading deals, what new tariffs and other barriers to entry should be made and what terms concerning free movement should be implemented.
Many EU political leaders are determined to negotiate harsher terms for Britain in order to deter other EU member states from leaving the EU. On the other hand, business leaders prefer more trade-friendly agreements to reduce economic harm as much as possible. Regarding fiscal issues, the revelation of the British exit has caused an economic panic that has led to wipe-out of $2 trillion of world markets, with some economists predicting that the Brexit vote will push the UK into recession. The British Pound Sterling has also fallen to a 31-year low on currency markets, dropping more than six percent against the Euro. Of course this has made summer holidays more expensive especially destinations within EU, although holiday makers will not see any immediate change until the 2 year period. FTSE has also been heavily affected as the FTSE 100 index had a 7% plunge following David Cameron’s resignation by October but has since recovered somewhat.
Many more changes are expected to come Brexit especially after the two-year period when Britain officially leaves the EU and no longer abides by its laws, at the moment the future looks uncertain and unpredictable.Thank you for reading my blog post and please feel free to join the conversation!