In a completely unparalleled event, the United Kingdom broke up with the European union (EU). In a referendum known as Brexit (Britain+ Exit), the UK has decided to part ways with the EU. With a vote of 52% in favour of leaving it was evident that Brexit was certain. If you are still wondering what it all means for both parties, take a look at 5 things you need to know about the Brexit.
The EU has deviated from its original purpose
The concept of EU came into picture after World War II as a means for European nations to forge economic ties with each other. This led to creation of European Economic Community (EEC) in late 1950s to fight against the Soviet Union. It later came to be known as the European Union (EU) in 1993.
EU had been weighing Britain Down
Ever since EU has outlived its original purpose, it has tuned into a powerful bureaucratic system that has been weighing Britain down. This is evident from the fact that since 1973, the British government has sent over £500 billion to the European union which is thrice the NHS budget. This twisted relationship with EU has been costing Britain over £350 million each week. Moreover, it eats into 11% of Britain’s GDP (as per a study by Cardiff Business School). This was further going to increase due to austerity measures being put in place and new projects of EU.
And then there was immigration
The Schengen Agreement of 1985 allows “free movement” among all the member nations of the EU without any need of a passport check. This was further aggregated by Germany’s decision to take in immigrant from North Africa and the Middle East. It led to an increase in fear of terrorism and violent crimes. This open border policy has led to an economic turmoil for Britain. There has been a rise of 3.7% in UK born unemployment from 2010- 2014. About half of this unemployment is credited to immigration which was allowed due to an open border policy.
It will hurt in short-term but help in long-term
As soon as the Brexit vote was out, the stock markets went for a spin. Gold rose by 6%. Sterling declined 11% against the dollar. Japan’s stock market fell by 8%. But this was expected. British economy will have to bear some pains in the short-term. But the long-term picture is much brighter and happier. Britain will be rid of the leftist regime of the EU and the UK will have an opportunity to form free trade agreements that aren’t watched and regulated by EU.
It might be the end of EU as we know it
Though Britain might have chosen to opt out of the European Union, it will still take some time to officially leave EU as it will have to negotiate an agreement with the Union. As per the Lisbon Treaty, it might still take at least 2 years.
But this isn’t all, now that Britain has left, other nations such as France, the Netherlands and Italy are also mulling their options. They can either go the British way and have their own referendums or continue to stay with EU. But one thing is certain, EU will never be the same now.