It’s official, the British people voted to leave the European Union on June 23. The referendum was preceded by debates, speculations and even the murder of Labour MP Jo Cox due to her pro EU stance. This represents a political defeat for Prime Minister David Cameron who announced (on Friday 24) that he will step down by October.
The results were tight. Some of the last polls conducted before the vote showed that the “remain” was ahead of the “leave”. As soon as the ballot boxes were opened, early results were confirming the trend. However, in the morning the world was struck by the victory of the “leave” vote: 52% against 48%. The turnout was of 71.8%, i.e., more than 30 million voters.
The results should boost Boris Johnson, former mayor of London and strong activist for the leave campaign, to take the office at Downing Street. In his statement he declared:
We can find our voice in the world again, a voice that is commensurate with the fifth-biggest economy on Earth […] I believe we now have a glorious opportunity: we can pass our laws and set our taxes entirely according to the needs of the UK economy.
Other European leaders were dismayed by the news. German chancellor Angela Merkel said dissatisfaction with the result while Jean-Claude Juncker ushered the UK to leave as soon as possible. Juncker’s reaction displays that the EU is not willing to wait until October when David Cameron stands down. Once the British people made its decision it is time to implement it in order to avoid further uncertainty.
The tweet of Martin Shulz, President of the EU Parliament, is a Clear example of the mindset in Brussels right now:
For 40 yrs #UK relation with #EU was ambiguous. Now it’s clear. Will of voters must be respected. Now need speedy & clear exit negotiation
— EP President (@EP_President) 24 June 2016
So, now what?
The fall of the pound
The pound has already suffered the consequences of the vote. The currency fell to its lowest level since 1985, being traded at $1.3236. Mark Carney, Bank of England governor, made a public statement to reassure the international community with regards to the strength of national banks. According to Mr. Carney, these institutions passed stress tests and successfully raised over £130bn of capital. Therefore there is “substantial capital and huge liquidity” in the financial system. As a backup plan the Bank of England has announced another £250bn, to address problems in the markets.
Scotland: a new referendum?
In Scotland the remain won by 62% to 38%. It’s worth to highlight that in 2014 the country held a referendum with regards to its independence vis-à-vis the UK. Back then, the Scottish decided to remain within the Union Jack. However, with results made available today Nicola Sturgeon, Scotland’s first minister, declared that policymakers would draft legislation to hold a new referendum. According to Mrs. Sturgeon the fact that Scotland might be ousted of the European Union against its will is “unacceptable“.
Working and living abroad
London is an international hub for business, with a dynamic financial sector. During the campaign companies warned that a Brexit would reduce London attractiveness. As a result, many banks would be willing to transfer headquarters and jobs to other countries in order to benefit from the European single market.
The decision of leaving the EU might also make difficult for British nationals to work and move to EU member States, once they will no longer benefit from the right of Free movement of workers. This is one of the principles of the Treaty on the Functioning of the European Union (TFEU), enshrined in Article 45 of the Treaty.
After forty years of skeptical membership, the UK will trigger article 50 of TFEU. This is certainly not the British finest hour. A return to splendid isolationism in an age marked by interconnectedness and interdependence.