POST-BREXIT TRADE AND ITS BUSINESS IMPLICATIONS.

Running head: POST-BREXIT TRADE AND ITS BUSINESS IMPLICATIONS
Post-Brexit Trade and its Business Implications
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POST-BREXIT TRADE AND ITS BUSINESS IMPLICATIONS1
Introduction
Brexit refers to a portmanteau of the two words, “Britain” and “exit” and it refers to
withdrawing of the United Kingdom from that of European Union. A referendum was held on
the 23rd of June in the year 2016 where 51.9 percent of the people who were voting supported
the leaving of European Union. Government invoked the Article 50 of Treaty on European
Union that started the two-year process which concluded that UK would have to exit on the
29th of March in the year 2019. The deadline has been extended to the 31st of October in the
year 2019. The withdrawal from European Union have been advocated both by the left-wing
along with the right-wing Eurosceptics (Internationalaffairs.org.au., 2019). The pro-
Europeanists who spanned the political spectrum have asked for the single market. In the
present time, the EU countries which includes UK benefit from the single market of
European Union. It includes absence of the duties along with the quotas for the member states
of European Union that carries out trading across the European Union. This essay focusses on
the post-Brexit trade and its implications for business in Australia.
Britain and the European Union
Boris Johnson developed the optimistic refrain that Britain have been betrayed by the
inability of Theresa May of pulling U.K. out of European Union. Boris Johnson was able to
seal the victory in a comfortable manner and he beat the rival Jeremy Hunt with that of 66.4
% of the votes of the party members. The appointment of Boris Johnson in role of the new
prime minister have paved the path for the exit of United Kingdom from European Union by
the end of October (Ft.com., 2019). He has been installed in the highest office of Britain with
the help of the internal party machinations and he is presently responsible for delivering the
promise. Johnson is liked by the members of the Conservative Party and the work that he
carried out in Brussels has been instrumental in laying foundation for Brexit. Johnson has

POST-BREXIT TRADE AND ITS BUSINESS IMPLICATIONS2
stated that he would leave European Union by stating a deal and that Brexit would not be
delayed any long.
There are certain sectors that would be hit hard in the event of UK leaving European
Union. There are some sectors that would experience biggest impact in terms of the exports
like the motor vehicles along with the electronic equipments. Motor vehicles refers to the
commodity that has highest share of the trade in between UK and the European Union. EU
can be said to be the primary export market for UK that accounts for 57.5 % of the exports of
the vehicles. Service sector refers to the sector that would be affected the most in the post-
Brexit era (Theconversation.com., 2019). It has been found that services industry comprises
around 80 % of total economy of UK. London is the financial center which can be said to be
the largest within Europe.
Effect of Brexit on Australia
The decision of Britain of leaving European Union would have consequences for the
relationship of Australia with that of Europe. The engagement of Australia with the European
Union can be said to be more than the extension of the relationship of Australia with UK. The
special trade relationship of Australia with UK dates back to the imperial preference for the
products from the Commonwealth countries. In the event of UK joining European market in
the year 1973 the trading arrangement ceased for that of Australia (Smh.com.au., 2019). The
economic co-operation in between Australia and the UK increased and this created the way
for the intensifying of the trade along with the investment relations. EU has emerged to
become a significant trading partner for Australia. EU can be said to be the trading partner of
Australia that is second largest after China. Decision of commencing the negotiations on the
FTA with EU helps in reflecting the strong relationship. Australia would have to face a
different kind of EU trade negotiator after Brexit (Abc.net.au., 2019). UK has been an