‘Brexit’ as a term was coined by Peter Wilding.
In a
famous quote he said “Unless a clear view is pushed that Britain must lead in
Europe at the very least to achieve the completion of the single market then
the portmanteau for Greek euro exit might be followed by another sad word,
Brexit.”
What does
this mean?
Brexit
is an abbreviation for "British exit," referring to the U.K.'s
decision in a June 23, 2016 referendum to leave the European Union (EU). It is an
abbreviation similar to “Grexit” a
lesser known term that was used for many years to refer to the possibility of
Greece leaving the Eurozone. Brexit refers to the possibility of Britain
withdrawing from the European Union (EU).
What led to this?
Brexit campaigners used worries about
immigration to create a populist backlash against Europe’s
political elite, overcoming concerns about the fallout from
Brexit on trade and the U.K. economy. They argued that the EU is morphing into
a super-state that increasingly impinges on national sovereignty. Britain has
global clout without the bloc, they said, and can negotiate better trade
treaties on its own. Years of frustration led to this referendum
and all of this can be summarized into three bullet points which are:
·
Economy - Opponents of the EU argued that it is a
dysfunctional economic entity. The EU failed to address the economic problems
that had been developing since 2008 for example, 20% unemployment in southern
Europe. The difference between the lives of
southern Europeans and Germans—who enjoy 4.2% unemployment—is profound.
·
Sovereignty- The second reason for Brexit is the rise of nationalism across the world.
There’s a growing distrust of multinational financial, trade, and defense
organizations created after World War II. The EU, the IMF, and NATO are
good examples of this. Many who oppose the EU believe these institutions no
longer serve a purpose. Not only that, these organizations take control away
from individual nations. Mistrust and fear of losing control made Brexit a
reasonable solution to them.
·
Political Elitism- Finally, the political leadership of Britain faced a profound loss. The “leave”
voters rejected both the Conservative and Labour parties. Both parties had
endorsed remaining with the EU and saw many of their members go into opposition
on the issue.
Ultimately, it was a three-way struggle. Two established parties wanted
to remain in the EU, and a third faction, drawn from both parties, opposed it.
People in this third group saw both of the establishment parties as hostile to
their interests.
The Social, Political and Economic
impact of Brexit on the EU and Britain
Great
Britain’s withdrawal from the European Union would not only change the internal
political climate, but it could have important political repercussions within
the EU and also on its relations with other European Community’s countries.
·
Social Impact: This initial analysis suggests that the Brexit vote reveals wider and
deeper societal tensions along the lines of age, class, income, and education.
By providing an account of the background and events of the referendum it asserts
that the vote was a case study in populist right-wing Eurosceptic discourse,
but it also reveals strong elements of English nationalism in parts of British
society.
·
Political Impact on the United Kingdom- The referendum of United Kingdom’s membership of the European Union was
one of the major promises of the Conservative Party in the UK’s general
parliamentary elections in 2015, in which they won. On June 23, 2016, the
British people voted in favour of Brexit with a narrow result of 51.9% to
48.1%. England had the highest percentage of Brexit voters, also the Wales with
52.5%, while Scotland was the country with the highest percentage of
anti-Brexit voters, than the Northern Ireland with 55.8%.The risks of Brexit
are very serious as they may result with the dissolution of the United Kingdom,
a union that was created more than 300 years ago. Based on the results of the
referendum, Scotland and Northern Ireland voted against leaving the EU, and the
most dissatisfaction with Brexit were in Scotland. The results of the June 23
referendum highlighted a hypothesis that perhaps the UK might be dissolved in
the future and that maybe in five years there will no longer be a United
Kingdom. Scotland will be independent and part of EU.
·
Political impact on the European Union - The European Union is described as sui generis, or ‘unique’ in its own
right because, unlike the United Nations and other international governmental
organisations, it can actually be said to exercise a degree of sovereignty over
its members via law-making powers in certain areas that its members agreed to
relocate to the supranational level. In Europe there is a rising tide of
discontent with the growing power of the EU and a desire in some political
circles to weaken, or even dissolve, the organisation so that more of the power
returns to the states. The European integration project is in poly-crisis mode:
the financial crisis, the debt crisis, the economic crisis, the Greek crisis,
the populism crisis, the productivity crisis, the terrorism crisis, the refugee
crisis and the democratic deficit crisis. But Brexit is a different type of
crisis. Brexit raises fundamental questions about the integration project. After
the Brexit referendum, important elections were held in the main EU countries,
in the Netherlands, France and Germany, characteristics of which were the
Eurosceptic and anti-immigration views of some candidates who received
extraordinary support from their citizens. Increase of Eurosceptic views is
contributing to the frustrations of the EU member countries citizens towards
its institutions regarding economic management and the immigration issues. The
British Brexit vote is perceived as a vote against immigration
·
Economic impact - A
large number of economic studies have now been produced which attempt to
quantify the likely longer-term impact of Brexit on UK’s economic output. These
studies focus on estimating how the level of UK output in around the year 2030
is likely to compare, post-Brexit, to the level of output that would have been
produced in that year if the UK had remained a member of the EU.
- JOBS- To the extent that there is a loss of GDP, it will also, in
macroeconomic terms, mean a lower level of employment in the UK economy. Demand
from other EU countries constitutes around 12% of final demand for UK goods and
services and this translates into around 3.3 million jobs.
- EU BUDGET- Based on the 2014 data most often quoted, the saving would be around
£280 million per week, not the £350 million so often claimed, because what the
UK ‘sends to Brussels’ is an amount from which the UK rebate has already been
deducted.
- POST‐BREXIT TRADE
REGIME—POSSIBLE SCENARIOS- Once
the UK is outside the EU, it will have its own trade policies. Depending on
which framework the UK chooses, its new relations with the EU can be quite different.
Trade policy is often entwined with a country's domestic policy.·
UK re-joins European Free
Trade Association- By joining EFTA and opting
for membership in the EEA like Norway's status, the UK would be eligible to
participate in the Single Market. In this case, the UK can have access to the
EU's 53 external free trade agreements (FTAs)
- UK seeks a customs union
with the EU- In this case, the UK would retain
full or partial access to the EU market. It would not be bound by the EU's
principle of free movement of people and its other regulations. Furthermore,
the UK would be able to conduct its own trade policies towards other countries.
- UK adopts the WTO rules and
chooses no separate deal with the EU- In this
case, the UK's trade with the EU would be governed by the WTO's
“most‐favoured‐nation” rules. Thus, Britain would face the EU's common external
commitments on services. Without them, it cannot even be guaranteed to trade
securely under the WTO rules.
