Breakups are never a happy thing. We read about legendary bands or celebrity couples breaking up quite often. We all know and understand the unpleasantness of separation. Perhaps the most sensational break up story ever told is Britain’s decision to get a divorce, the story currently doing rounds of news channels all over – BREXIT.
But first, what is the European Union and what are the views of both camps?
The European Union:
The European Union – often known as the EU – is an economic and political partnership involving 28 European countries (click here if you want to see the full list). It began after World War II to foster economic co-operation with the idea that countries which trade together are more likely to avoid going to war with each other.
It has since grown to become a “single market” allowing goods and people to move around, basically as if the member states were one country.
It has its own currency, the Euro, which is used by 19 of the member countries, its own parliament, and it now sets rules in a wide range of areas – including on the environment, transport, consumer rights and even things such as mobile phone charges.
Why did talks of a referendum to leave the EU come up in the first place?
Those who favoured a British withdrawal from the European Union – commonly referred to as a Brexit – argued that the EU has a democratic deficit and that being a member undermined national sovereignty, while those who favoured membership argued that in a world with many supranational organisations any loss of sovereignty was compensated by the benefits of EU membership. Those who wanted to leave the EU argued that it would allow the UK to better control immigration, thus reducing pressure on public services, housing and jobs; save billions of pounds in EU membership fees; allow the UK to make its own trade deals; and free the UK from EU regulations and bureaucracy that they saw as needless and costly.
Those who wanted to remain argued that BREXIT would risk the UK’s prosperity, diminish its influence over world affairs, jeopardise national security by reducing access to common European criminal databases, and result in trade barriers between the UK and the EU. In particular, they argued that it would lead to job losses, delays in investment into the UK, and risks to business.
In January 2013, Cameron promised that should his Conservative Party win a parliamentary majority at the 2015 general election, the UK Government would negotiate more favorable arrangements for continuing British membership of the EU, before holding a referendum on whether the UK should remain in or leave the EU. In May 2013, the Conservative Party published a draft EU Referendum Bill and outlined their plans for renegotiation and then an In-Out vote if returned to office in 2015. The draft Bill stated that the referendum must be held no later than 31 December 2017.
The vote took place on Thursday, 23 June 2016 in the UK and Gibraltar to gauge support for the country’s continued membership in the European Union. The referendum resulted in an overall vote to leave the EU, by 51.9%. The result was split between the constituent countries of the United Kingdom, with a majority in England and Wales voting to leave, and a majority in Scotland and Northern Ireland, as well as Gibraltar, voting to remain. Other member countries of the EU are now asking Britain to start the process to leave the EU, which is expected to take several years.
Impact of BREXIT:
Financial markets reacted negatively to the outcome. Investors in worldwide stock markets lost more than the equivalent of 2 trillion United States dollars on 24 June 2016, making it the worst single-day loss in history, in absolute terms. The market losses amounted to 3 trillion US dollars by 27 June. The value of the pound sterling against the US dollar fell to a 31-year low.The UK’s and the EU’s sovereign debt credit rating was also lowered by Standard & Poor’s. By 29 June, the markets had returned to growth and the value of the pound had begun to rise.
Immediately following the result, the Prime Minister, David Cameron announced he would resign, having campaigned unsuccessfully for a “remain” vote. He was succeeded by Theresa May on 13 July.
Scottish First Minister Nicola Sturgeon said it was “clear that the people of Scotland see their future as part of the European Union” and that Scotland had “spoken decisively” with a “strong, unequivocal” vote to remain in the European Union. The Scottish Government announced on 24 June 2016 that officials would plan for a “highly likely” second referendum on independence from the United Kingdom and start preparing legislation to that effect.
In fact, the day after the vote, the most Googled item in the UK was “What is the European Union?”!
So the decision of UK to sever ties with the EU had a bitter-sweet outcome. There were winners and losers. Although it is expected to take a long time for the UK to completely break free, the ripples created by the referendum are being felt all over the world. All we can do now is to be patient and hope for the best!
Everything else apart, BREXIT might actually mean something positive for the Indian students in terms of higher education in UK. Read about it here.