When the Leavers claimed victory in the referendum, mainstream media as well as social media went into a frenzy predicting doomsday for UK. Ironically the similarities are striking – where social and economic discontent capitalised by tapping the fear of people, of subtle xenophobia, and vague nostalgic feeling of making these nations glorious again.#dumbBrits – “Brits can no longer make fun of how dumb everyone in the US is now” began trending on Twitter just as Brexit news came in a couple of days ago.
Ironically the similarities are striking – where social and economic discontent was capitalised by tapping the fear of people, of subtle xenophobia, and instigating a vague nostalgic feeling of making these nations glorious again.
The world markets and political spectrum went on a total head spin not really knowing what just hit them. The Brexit results were like a bolt from the blue. Stock markets crashed, the pound was crushed, major banks such as Lloyds, and Barclays showed almost 30-40% decline in value, and financial institutions such as JP Morgan, HSBC and Goldman Sachs all admitted that thousands of jobs in the city of London could move to Europe in case Brexit happens.
When the Leavers claimed victory in the referendum, mainstream media as well as social media went into a frenzy predicting doomsday for UK. With David Cameron giving in his resignation and the opposition and major Brexit campaigners admitting that they had no plausible MO, post Brexit scenario, all hell broke loose.
England’s fate was sealed. Chaos and uncertainty reigns like the final act from a Shakespearean tragedy; or is it a comedy? The country as of now stands deeply divided – The Leavers and the Remainers. Passions run high as the more sinister face of Brexit is emerging in the form of complicit Xenophobia.
Brexit in essence has been one of the most defining moments in history as the fall of the Berlin Wall. Euroskeptics laud the British people who voted to Leave, saying that they failed to be intimidated by the elitist European Parliament. In bitter emotional debate in the EU Parliament post Brexit, in Brussels, the EU Commission President Jean Claude Juncker warned against any delay or shadow boxing by UK and invoke Article 50 at the earliest. There will be repercussions, both for the EU and UK. After the market volatility of the past few days, the pound plunging to an all time low in 31 years and share values plummeting, pressure is mounting on UK to invoke Article 50 for the exit.
Here are what we think are the pros & cons of Brexit and its effect on Britain & EU:
EU as a bloc acts as a single market and imposes no taxes on exports and imports between member states. Britain benefits from the trade deals EU has with the rest of the world. Breaking away would mean that Britain loses its negotiating power. However, she’s now free to establish her own agreements.
Euroskeptics are of the opinion that small to medium businesses do not trade within EU and are restricted by regulatory terms imposed. Experts say that Britain’s GDP could increase by 1.6% by 2030, if the UK were able to negotiate free trade deal with Europe. But how much the EU would comply to it remains to be seen. It will have to renegotiate trade deals with EU 27 member nations and the remaining 161 members of the WTO. This will be a long drawn out negotiation process.
Pro – EU campaigners are of the opinion that investments would take a nose dive and that UK’s position as one of the world’s largest financial centres will not have takers once it exits EU. In a very detailed assessment, Professor Nick Crafts of Warwick University, leading economic historian, estimated that EU directly raised UK prosperity by about 10 percent, due to increased competition and better access to single European market. Major banks & financial institutions have expressed concern due to this. Businesses are nervous and are contemplating relocation elsewhere considering the political uncertainty, market volatility and leadership vacuum.
Immigration and unemployment were the basic premise of the Brexit referendum. According to the EU law, Britain cannot prevent anyone from other member state coming to live in its territory and vice versa. This resulted in an immigration exodus into Britain especially from Eastern Europe. Territorial passions were whipped up by the Leave camp on the immigration issue. PM Cameron’s most important achievements was his renegotiation with the EU regarding immigration laws. Brexiters on the other hand believe that leaving EU will allow them to regain control of their borders and limit undeterred immigration.
Brexit’s effect on employment will be multi factorial. It will depend upon how the above 3 factors will play out. If trade and investment increases, then new jobs will be created and if it falls, there will be further unemployment. A drop in immigration would mean more employment for Britain. But then again a shortage of labour could affect the output as well as economy.
Pro-Brexit camp are confident that leaving EU will secure borders and deter terrorist attacks as better immigration and surveillance can be now enforced. Pro-EU camp emphasize the need for close intelligence and information sharing with EU partner nations in the face of Middle East instability and perceived Russian aggression.
Amidst all the conundrum and noise, it is hard to have a balanced perception of things. Is it truly an economic, social and political apocalypse as we know it? Or when the sound bytes settle, would there emerge a more insightful rationale behind the Brexit referendum? Perhaps the greatest uncertainty is exactly that: that no nation has done it before. As the French National Front (FNF) leader and MEP Marine Le Pen said, Britain fired the first shot. It wouldn’t be surprising if others followed suit. It is also a wake up call for the MEU to get their act together and have a more inclusive democratic form of pragmatic governance. Otherwise EU would remain just a beautiful Utopian dream – where love, compassion, free trade and humanitarian values stood above sectarianism.
(Husna Mohammad is a Cochin based writer and entrepreneur. She is a dentist by qualification, but her love for the written word lured her into the world of journalism and creative writing. Her areas of interest range from topics such as politics, art & literature, economy & human rights. She is currently a content and social media consultant & the co-founder of a travel & culture portal The Silk Route Co. She is also a guest feature writer for Arabian Gazette)