Brexit kick-off: a historic day for the EU anticlockwise

Teresa May Francois Hollande 2017

Informal meeting of EU Heads of State or Government – February 2017. From left to right: Ms Theresa MAY, UK Prime Minister; Mr Francois Hollande, President of France. Shoot location: Valetta – MALTA. Shoot date: 03/02/2017. Copyright: European Union.

The beginning of the two-year negotiations is about to begin as UK submits today the letter to the EU today informing the latter about the decision of the British people to leave the bloc. However, it is still too early to say whether a deal will be reached within the timeframe that is set in Article 50 since two years is a very short time when dealing with such a very complex agreement.

Financial markets haven’t also fully weighted the consequences of Brexit and the British pound is about to experience a volatile period as it has dropped significantly in comparison to the U.S. dollar since the UK referendum. Britain’s hard stance regarding the upcoming trade deal with the EU will surely be influencing the sterling.

Furthermore, the manufacturing body of UK (EEF) has expressed its great concern that a no-deal will have disastrous effects on the British economy. According to EEF, the UK should definitely reach a secure agreement with full WTO membership allowing a free movement of goods and people.

Will Brexit hurt the UK economy?

According to the HIS Markit, only 29% of the British citizens believe that Brexit will boost the national economy in the next 10 year-period when about nine months ago the majority of the public opinion (39%) were supporting that it would be better for the economy to leave the EU. Thus, it is high likely that this sentiment will change many times during the harsh negotiations between the UK and the EU.

Furthermore, the manufacturing sector is about to be influenced negatively since it will not have access to the single market. The EEF published a report, responding to the UK Prime Minister’s recent statement that “no deal for Britain is better than a bad deal for Britain”, mentioning that businesses could probably face WTO tariffs of more than 5% on exports to the continent without a trade deal with the EU.

It is very crucial both for the EU and the UK to reach a mutual trade agreement since the EU is the largest manufacturing partner of Britain and the UK manufacturing sector employs 2.7 million people and accounts for 45% of the exports.

Brexit increases financial uncertainty

There are lots of uncertainties in the financial world and Brexit is surely one of them. According to Nomura, the Japanese financial holding company, “one of the main factors affecting sterling is the risk of a hard Brexit, which would mean that the U.K. would leave the EU without any agreement and raising all sorts of uncertainty, including on trade and financial services”.

The German Finance Ministry is also worried about a “Hard Brexit” and whether the EU and UK will manage to reach a deal in the predetermined period of time. The analysis of the German Ministry concludes that there will be an impact on the stability of the financial markets if Britain will not strike a deal with the EU. According to the report, such an event could trigger serious problems in the banking system with British banks not to be able to offer services in the EU and EU banks will have no access in London. Germany is following a hard stance on the Brexit procedure and will force the UK to meet all its obligations including paying to have access to the EU Single Market.

Negotiations will be long

It is understandable that the EU will be pushing Britain to the edge in order to reach a bad agreement for the UK discouraging the rest of the EU members to follow UK’s route. However, UK is a very strong economy and it will exhaust all possibilities to come up with a deal of its interest.

One thing is for sure though: negotiations are most likely to last for a long time, something that will lead to further uncertainty. Already banks and other businesses have been relocating jobs outside of London and the UK. The good performance of the UK economy in the aftermath of the referendum has started changing as inflation increased to 2,3% in February over the previous year and consumers are influenced by the pressure of higher prices.

All in all, it seems that the uncertainty will keep on rising in the UK and the EU as there is still no economic and political Brexit plan by both parties.

Advertising

Advertising

Advertising

Advertising

Advertising

Advertising

the sting Milestone

Featured Stings

Can we feed everyone without unleashing disaster? Read on

These campaigners want to give a quarter of the UK back to nature

How to build a more resilient and inclusive global system

Stopping antimicrobial resistance would cost just USD 2 per person a year

Amid ‘volatile’ environment, UN mission chief urges Iraqi leaders to ‘listen to the voice of the people’

Climate change recognized as ‘threat multiplier’, UN Security Council debates its impact on peace

Turkey presents a new strategy for EU accession but foreign policy could be the lucky card

Don’t dismiss start-ups founded by millennials. This is how they succeed

The ‘abuse of food relief in Yemen’ must end now

A young student discusses the determinants of migration in the European Union

EU to present a “hefty” exit bill to the UK moments before Brexit negotiations

Brazilian public health system and universality: a forgotten right!

The ethics of the Medical Technology Civilisation era

Special measures for Greece: 100% absorption rate

Globalization is changing. Here’s how your business can adapt

The EU Parliament slams Commission on economic governance

UN committed ‘to support the Libyan people’ as Guterres departs ‘with deep concern and a heavy heart’

The Free World Experience Report – LGBTQI+ health on the spot

Women’s leadership ‘critical’ to future of Niger

Chicken soup for the digital soul: how to bring community back online

Legal Manager – 2050

The future of science could be in your gut. Here’s why

Traditional knowledge at ‘core’ of indigenous heritage, and ‘must be protected’, says UN Forum

Bring killers of journalists to justice: UN agency seeks media partners for new campaign

World faces ‘climate apartheid’ risk, 120 more million in poverty: UN expert

Here’s how data can shine a light on financial crime

Joint UN-Red Cross appeal to end rising sexual violence as a weapon of war

Efforts to save the planet must start with the Antarctic

Global aid needed for healthcare

EU and New Zealand launch trade negotiations

Climate change and its adverse impacts on health

Parliament backs new CO2 emissions limits for cars and vans

What brands get wrong about China – and how to put it right

Global Trade Identity can be the cornerstone of paperless trade

Europe, US and Russia haggle over Ukraine’s convulsing body; Russians and Americans press on for an all out civil war

A Europe that Protects: Commission calls for more efforts to ensure adoption of security proposals

The UN went to one of the world’s richest countries to look at poverty – this is what it found

These are the 4 most likely scenarios for the future of energy

7 surprising and outrageous stats about gender inequality

‘We need to do more’ to transform the world, deputy UN chief tells African audiences

Growing up near green space is good for your mental health as an adult

Night owls, rest easy

Evacuation of wounded Yemenis from rebel-held capital may bolster fresh peace talks

As the Universal Declaration of Human Rights turns 70 – is it time for a new approach?

EU-US trade war: Will Trump take advantage of WTO’s decision leading to ominous economic growth?

Mental health in medical students: the deciphered quandary

MEPs criticise “America first” policy

MEPs back plans to promote water reuse for agricultural irrigation

The 27 EU leaders did nothing to help May unlock the Brexit talks

“Beating pollution for our planet”, a Sting Exclusive by Mr Erik Solheim, the Executive Director of the United Nations Environment

A Sting Exclusive: “Without climate, forget about peace!”, Swedish MEP Bodil Valero cautions from Brussels

Syrians still living on ‘razor edge’ as UN launches $8.8 billion dollar appeal

This is how much people would pay to use some of the world’s most popular apps

New EU rules to boost crowdfunding platforms and protect investors

Japan initiates WTO dispute complaint against Korean duties on steel

New energy security framework will help meet growing needs in East Africa, sustainably – UN economic wing

Building cybersecurity capacity through benchmarking: the Global Cybersecurity Index

Why our future relies on more inclusive and transparent innovation

Electronic or conventional cigarettes – which is safer?

Make progress or risk redundancy, UN chief warns world disarmament body

‘Unconscionable’ to kill aid workers, civilians: UN Emergency Coordinator

Freshwater is saltier – and it’s bad for the planet and our health

Solidarity Corps: more opportunities for young people

Following the World Cup? Then you’re watching high-performing migrants at work

More Stings?

Speak your Mind Here

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s