UK Votes For BREXIT - What Does This Mean?

It’s a historic morning for the UK and I am in a state of disbelief. The dust is settling at polling stations across the nation and despite the early hour its fair to say a few champagne corks have been popped by those hoping for a #Brexit .

By a narrow margin, the people of the UK have taken the monumental decision to leave the world’s largest free trade area and go it alone in the world.

Whether this was driven by fear of mass immigration or genuine belief that the British economy will be stronger if unfettered by Brussels' bureaucracy will be debated in years to come. But this morning Britain awoke facing an uncertain future.

So what will this mean? Here’s a look at what I think some of the possible consequences of this world changing decision could be.

The first certainty is uncertainty. Nothing like this has happened before, and if the UK leaves, it will be the first member to do so in the EU’s 59 year history. Within hours of the decision being made, the pound fell to its lowest point since 1985 and the FTSE  fell by 7 percent minutes after opening. Financial services took a particularly heavy hit. Financial markets simply don't like uncertainty and unfortunately this is exactly what we will get for some time to come.

Political unrest is also likely, in the UK and possibly across Europe. Just before  8:30am this morning David Cameron announced that he will resign as Prime Minister. His intention is that he will remain in position until the party conference in October. This announcement caused speculation that the UK will face a general election in the near future. Anti-EU groups in France and the Netherlands are celebrating, while calling for referendums in their own countries. There is also likely to be a renewed push for Scottish independence as the “remain” vote was far stronger there than in England and Wales.

Many are hoping that leaving the EU will leave UK business facing less regulation and red tape. While a lot of EU laws governing industry and employment may become redundant in the UK, it will have to be replaced with something. Britain’s ability to trade around the world is dependent on its compliance with international standards in every area from aviation to human rights. Much of this is currently covered by EU regulation which will be thrown out when Brexit goes ahead. However, those championing Brexit say it will give UK businesses greater agility with which to navigate international markets.

Immigration into the country is not going to stop overnight, and foreigners living in the UK won’t immediately face deportation. What it will mean is that Britain can rewrite the rules on who can and can’t come in to this country. 

The trading relationship Britain has with Europe will have to be renegotiated. There are hopes that strong ties and self-interest mean there will be good will on all sides here. All parties benefit from trade between the UK and the continent and efforts will be made to preserve it. But there are no guarantees and the terms and conditions will be far less stable than they are now, and liable to change with future EU leadership changes. 

The 1.1 million Britons living as expats in the EU will have more cause for uncertainty than most. What happens to them is likely to be heavily dependent on new agreements which will be drawn up based on whatever new relationship emerges between the UK and the continental nations. Likewise, European citizens living in Europe will have to wait a while to see how events will affect their right to stay.

The result could also breed a certain amount of resentment between generations. It’s early for reliable statistics but it is believed that among 18 to 25 year olds the remain vote was as high as 70%. 

There is also the outside possibility that nothing will happen. David Cameron has already said he will leave invoking Article 50 – the legal mechanism for breaking from the union – to his successor.  A referendum result is not legally binding and the Government could ignore it. However, this is very unlikely though as it would most likely lead to mass revolt at the next general election.

So to wrap up – there’s a lot of uncertainty in the air right now. Whatever people’s motivations for voting “leave” were, serious thought will have to be given to what we are going to replace it with.

If Brexit goes ahead, which it surely will, the political and economic landscape is likely to look very different in five years than it does today.

I have always seen it as a privilege to live in a democratic, diverse, forward-thinking and successful place like the UK. It is important to respect the views people have expressed in this referendum and take the decision as a new mandate for change. It is now up to the people here in Britain, the the leaders we elect and the partners around the negotiating table to ensure that this change is for the better for the UK, Europe and the World as a whole. 

As with all my posts, I would love to hear your views. Please use the comments below to share your thoughts.

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