Will Brexit get an „exit” by the end of 2020?
Sergiu MedarGreat Britain held, on June 26th 2016, a referendum by which it chose to leave the European Union. Since that moment, it started the complicated negotiations that seem to have reached the impossible. On December 12th 2019, the early elections were won by conservatives, which have confirmed Boris Johnson’s position, its leader, as prime-minister. He promised he will not get a no-deal Brexit. Negotiations did not get to a definitive deadlock, but someone definitely has to make a compromise.
On December 12th 2019, it ended an important chapter of the process that seemed to get to no end, in terms of Brits options on the problem they created themselves about United Kingdom’s withdrawal from EU. The early elections were won by the Conservatory Party, led by Boris Johnson, whose main electoral campaign messages was that he will end Brexit procedures by January 31th.
On June 26th 2016, the United Kingdom held a referendum on leaving EU. Giving up some of their wealth, the Brits decided not to give up their state’s sovereignty. 17,4 million voted for their withdrawal and 15,1 million voted against. Therefore, on March 29th, former prime-minister, Theresa May, issued the EU a notification by which it was announcing that Great Britain was leaving the organization. 21 months of negotiations with EU on the withdrawal transition followed that moment and, in March 19th 2018, it was completed and issued by Theresa May to the British Parliament for approval. The EU gave the United Kingdom a deadline, March 29th 2019, to approve the Brexit deal. It followed a series of deadline extensions: October 31th 2019 and January 31th 2020. As it could not get parliament’s vote, of June 7th 2019, Theresa May resigned. Then they had early elections, conservatives won and Boris Johnson was reconfirmed as prime-minister, having a reasonable majority.
The Conservative Party claimed, not just during the electoral campaign, but also before that, that they want a no-deal Brexit, meanwhile the Labour Party, led by Jeremy Corbin, had quite confusing messages. The Labour opposition did not want Great Britain to get out of EU and was asking for a new referendum. During the electoral campaign, Corbin’s proposals were out of the liberal democracy framework. The fact that the Labour Party lost the elections is the same with rejecting a new possible referendum and, at the same time, a strong message by United Kingdom’s population for a country with an increased sovereignty future, which follows the rights and liberties of liberal democracy.
The early elections’ result from December 12th eliminated some of Great Britain’s options. According to current data, Great Britain’s options were:
-No deal Brexit;
-Hard Brexit;
-Brexit following former prime-minister’s proposal, Theresa May;
-Renegotiations, unaccepted by EU;
-A new referendum. After the early elections results, this is no longer the case;
-Giving up Brexit, an impossible option given December 12th elections’ result.
A no deal Brexit consequences
A no deal Brexit is United Kingdom’s EU exit with no free trade agreement, which involves paying taxes for trade deals with other European states. British products export prices will increase affecting the exporters. Also, it will increase the import price of EU import products. A third of food products are imported by EU member states. For example, it will be increased tobacco’s price with 74%, orange juice’s price with 22% and 10% for cars. It will implicitly increase inflation which will lead to population’s living decrease. Also, the local food production decreased due to climatic change’s effects.
Custom control will also be firmer and product’s waiting time when entering/leaving the country will increase as well.
In case of a no-deal Brexit, North Ireland will stay in the United Kingdom until Ireland will still be part of EU. They will reestablish a border between these two states, also applying Schengen rules and custom taxes between the sister-states. Such states could trigger a new conflict between them. The conflict that stopped through border’s elimination. 30.000 workers are crossing the border daily to get to work. They would have to cross the custom after a no-deal Brexit.
These are just some of the reasons why the no-deal Brexit was used by Boris Johnson as a pressure method to sign an agreement with EU, but, in fact, the prime-minister does not agree with this option.
Great Britain will have to pay EU, for its withdrawal, an amount worth of $ 50,7 billion. It will have to provide all rights for EU’s member states’ citizens living on its territory.
A Hard Brexit consequences
A hard Brexit is like a no-deal Brexit, which includes a free trade agreement between Great Britain and the European Union.
This exit option will be devastating for London’s financial framework. As English language will no longer be EU’s official language, nor the European banking system will use it anymore. By giving up EU’s banking center 5.000 jobs will be lost and will lead to huge losses for the real estate field.
British companies will no longer be able to join auctions for state contracts in EU’s member states.
Services will meet some of the biggest losses. It will increase the costs for banking services, air transport, and internet, telecommunication services.
Along with matters related to Ireland and North Ireland, the United Kingdom could also lose Scotland, which, most likely, will ask, again through a referendum, the separation from the Kingdom in order to stay in EU.
Brexit according to Theresa May’s agreement
Following this option, Great Britain would stay in EU’s Custom Union, unlimited. There will be no export/import taxes. Former prime-minister’s critics want the extension of United Kingdom’s freedom to sigh free exchange contracts with states outside EU.
The more than 3 million EU citizens working in Great Britain will have the possibility to continue to work there with no additional work visa. Brits working in EU’s member states will have the same rights.
Great Britain will allow the European Court of Justice and EU’s legislation to apply the laws, however, as it will no longer be EU’s member, it will not be part of voting the laws. These will be turned into United Kingdom’s laws and will be approved or amended.
According to Theresa May’s agreement with EU, no border between Ireland and North Ireland will be established. This document is still subjected to approval on British Parliament’s desk.
Following this agreement, Great Britain will not limit EU’s citizens’ freedom of movement. This was, in fact, the main reason Brits wanted Brexit.
A no-deal Brexit consequences for EU
The Brexit vote mostly came due to trying to avoid the uncontrolled immigration in Great Britain, which triggered anti-immigration political movement in the entire Europe. If these parties will get to lead in France or Germany, which may happen, they will ask, most likely, for their states withdrawal from EU, following Brexit’s model, and the strong European economic organization may fall apart. If such thing happen, as the last surveys are revealing, EU’s member states cohesion will be more consolidated. Many European states reminded that, many times, Great Britain blocked European legislation proposals, especially on security matters.
From an economic perspective, EU states will deal with many losses due to import products deterrence in their country. Most likely, German will be the one to suffer the most, as it will affect the car industry, that the 10% import taxes will increase the price and deter the demands.
A no-deal Brexit consequences for US
A no-deal Brexit will, most likely, lead to a serious decrease of the British lira and dollar’s increase, hereof financial stock changes. It will increase the American markets and will deter the foreign investors.
The US exports to Great Britain will be more expensive, therefore their volume will be smaller, especially in the food industry and advanced technologies. We shall not forget that United Kingdom is the fourth export direction for American products.
The Brexit vote is, in fact, a vote against globalization, having unexpected consequences. Great Britain’s withdrawal from EU will have global effects. There is no country to stay unaffected by this decision.
After being reelected by Great Britain’s prime-minister, Boris Johnson promised that a no-deal Brexit or a Hard Brexit are not options the government thinks of. One can say that these options, often claimed by conservatives, were only pressure methods both internally and externally.
Most likely, Boris Johnson will continue the negotiations with EU, based on Theresa May’s proposal, to get other advantages too. The January 31th deadline to end it is, however, very short and they may get a new postponement, as a no-deal Brexit is not an option for them. And they know it!
The answer for the initial question is: No, until “Exit”, Brexit goes on!
Translated by Andreea Soare
