Brexit and its Implications: A Case Study of the UK's Exit from the EU

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CASE STUDY: BREXIT
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CASE STUDY: BREXIT
Table of Contents
Introduction......................................................................................................................................3
Brief overview of Brexit..................................................................................................................3
Current position of Brexit............................................................................................................4
Debates regarding Brexit.............................................................................................................5
Options for UK regarding Brexit.....................................................................................................6
Obstacles faced by UK....................................................................................................................7
Effects of No-deal Brexit.................................................................................................................7
Recommendations............................................................................................................................8
Conclusion.......................................................................................................................................9
References......................................................................................................................................10
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CASE STUDY: BREXIT
Introduction
In the year 1951, the Inner Six countries of Europe signed Treaty of Paris, which aimed at
creating a sense of unity among these nations in order to avoid conflicts in interest and another
World War. They established the European Coal and Steel Community (ECSC). According to
Brakman et al. (2018), this treaty proved to be a success and led to the signing of other treaties
like the Treaties of Rome in 1957, which established the European Economic Community
(EEC). With the efficiency of these communities, United Kingdom wanted to include them.
However, the then French President, Charles de Gaulle prevented the annexation of UK in the
community. Later in 1973, UK succeeded to become a member of the European Community
(EC). However, one year later, the government led by the Labour Party in UK cited the terms of
membership of UK to be unfavorable and organized the first national referendum that aimed at
resolving the conflict of continuing the membership of UK in the European Union. Debates have
been raised ever since about the decision of UK remaining in the community. Brexit refers to
Britain’s Exit from the EU, and has been a hot topic of debate in the politics of Europe in the last
few years.
Brief overview of Brexit
In the contemporary times, the matter rose in spotlight in 2012 when David Cameron, former
Prime Minister of UK put down the rising notion of a referendum regarding the continuation of
EU membership. However, Colantone and Stanig (2018) argued that the assurance of a
referendum became the primary weapon for David Cameron and the Conservative Party in their
2015. After the won the election, the European Union Referendum Act of 2015 was introduced
in the parliament, which aimed at revising the terms of membership of UK with the EU.
However, catering to the growing tension in British politics, the question of the referendum was
finalized if United Kingdom should continue with their membership or exit the European Union.
Current position of Brexit
After all these, a public referendum in 23rd June 2016 was held. With a close contest, the vote
was in favour of leaving the EU. Over thirty million of people voted, out of which a majority of
which 17.4 million people were in favour of Brexit. The Leave Vote won by 52 percent to 48
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percent. Brexit would break a 46-year-old political and economic relationship of UK with 28
other member countries. Dhingra et al. (2017) mentioned that the Brexit has gained a lot of
support over the years since the referendum, and is a pressing matter for the government. Prime
Minister Theresa May triggered Article 50, which initiated the formal process of Brexit in 2017.
Initially, Brexit was scheduled on 29th March 2019. However, Menon and Salter (2016) argued
that the British parliament failed to agree with the Brexit deal proposed by EU. Thus, a delay in
the exit was seen, the pressure of which led to the resignation of Theresa May. Brexit has been
postponed twice by UK.
After the resignation of Theresa May, she was replaced as a Prime Minister by Boris Johnson.
Soon after his arrival, he made it clear through his campaigns that UK is destined to leave the
EU. It the EU fails to provide a deal, which satisfies the needs of the British parliament, they
would leave without a deal. On the other hand, the European Union cites the demands of UK to
be unrealistic. This creates an environment of unrest and conflict in the ‘divorce’ process. The
final date for Brexit has been fixed on October 31, 2019 and Boris Johnson confirms this date by
saying that they would meet this scheduled date with or without a settlement deal with the EU
(BBC, 2019).
The Brexit deal, which has created this unrest situation, covered a number of things that
included:
 Ensuring the rights and freedom of UK citizens in the EU territory and EU citizens in the
UK
 The financial obligations of the UK to the EU (estimated to be about 39 billion Euros)
 The backstop for the North Ireland border
Debates regarding Brexit
Brexit has always been a matter of debate in the political and economic sectors of the UK.
However, after much debates, the parliament finally conducted a referendum, which stood in
favour of leaving. Though the Leave Vote won, they did not win by a huge margin. The negative
effects of leaving EU are numerous. For instance, the people in favour of Brexit believe that the
backstop being imposed by the deal in the border of North Ireland would not be revised in
further deals, and may result in setting down a harder border. Dorling (2016) noticed that this
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will acts as an obstacle for UK since North Ireland is a part of the UK. These factors lead people
to believe that a withdrawal of the UK from the EU may not satisfy the needs of both the parties.
These debates are the chief reason for the delay of Brexit. A part of UK still thinks that the
membership of EU should be continued and a proposal for renegotiation of the existing terms of
membership to be done. While the other part supporting Brexit demands the needs of UK and
leaving EU even if no deal is finalized.
Options for UK regarding Brexit
Hobolt (2016) opined that the British Prime Minister Boris Johnson stated that UK would be
prepared for a withdrawal from EU without a deal, even though he assures a commitment
towards a better deal. Some people against this statements argue that a more lenient and subtle
leadership could have been adopted which would ensure a satisfactory result in economy and
business relationship with the rest of Europe. An efficient relationship in trading with the
European community would avoid the imposition of taxes, tariffs and quotas. This would further
resolve the backstop problem in the border of Ireland.
The leader of the Labour Party, Mr. Jeremy Corbyn has focused his activities to maintain a
flexible perspective in the Brexit case for his party. However, many members of his party have
led him to support a notion of organizing a second referendum for finalizing the withdrawal.
The results of the second referendum are also doubtful. There is little assurance that a second
referendum would deliver a change in result. It may result in various ways. Moreover, the
supporters of Labour Party do not agree unanimously on the result of this decision.
Inglehart and Norris (2016) suggested that a major portion of people in support of the European
Union wants the British Parliament to terminate the Brexit initiative or delay it for many years
and revoke the Article 50.
With the Parliament being suspended and a limited time to come up with alternatives, the
withdrawal of UK without a deal remains a viable possibility supported by people in favour of
Brexit along with Prime Minister Boris Johnson
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CASE STUDY: BREXIT
Obstacles faced by UK
United Kingdom has been trying to move out of the EU for years, and till now they have failed to
do so. This is because there are a number of obstacles that prevent the UK to move out without a
deal. Kierzenkowski et al. (2016) mentioned that ending the relationship with the European
league could have harmful effects on the UK. The customs union maintains a single market,
which ensures smooth transfer of goods and products among the member countries along with
maintaining a standard equal rate of taxes and duties on the goods.
For instance, after UK leaves the customs union without a treaty or deal, the EU nations would
start checking on the goods entering from and going to UK. This would cause a delay in the
airports, make the process of import and export of supplies slower, hence affecting the economy
of the UK.
Another obstacle was faced when Northern Ireland had accepted some regulations of the EU in
the matter of agriculture by avoiding the setting up a border between the Republic of Ireland and
Northern Ireland. England had to accept this notion by implementing checks on economic goods
and products that enter and leave the Northern Ireland to and from the rest of UK.
Effects of No-deal Brexit
The effects that a no-deal could have on the UK could directly affect the daily lives of non-EU
citizens living in UK.
About 30 percent food comes from the EU. After a no-deal Brexit, a scarcity in fruits and
vegetables, or a steep rise in its prices could be expected. Regular checking at ports such as
Dover would result in delaying of supplies to the markets and thus reduce availability. Storages
of medicines are also a matter of concern for UK. The government on the other hand demands
that precautions have been taken regarding these matters beforehand to mitigate the negative
effects of no-deal Brexit.
Economists and business groups believe that a no-deal Brexit would affect the economy of the
UK in a more severe way than expected. The Office for Budget Responsibility is an organisation
that provides an independent analysis of public finances of the UK (Nytimes, 2019). They
believe that a recession in UK market could be triggered if a no-deal Brexit is reached. However,
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Brexiters argue this notion by saying that the economic anomaly caused would be short term and
minor as compared to the long term economic opportunities Brexit provide. They further state
that a prediction of such accuracy could not be done keeping in mind the market flexibility.
A serious matter common people and NGOs concern with is that the support of European Health
Insurance Cards (EHIC) would seize to function in UK. Pet passports would also become
invalid.
However, Menon and Salter (2016) argued that the matter of citizenship would not be much of a
problem. The EU citizens that have settled in UK would be eligible to apply for UK citizenship.
On the other hand, UK citizens residing in EU countries would have to apply for citizenships in
the respective countries. This would also trigger a chaos and a matter of disturbance for these
people. People travelling between UK and EU countries would require passports that should be
valid for at least six months after the 31st October 2019 (the scheduled Brexit date).
Recommendations
Mr. Johnson has suggested another option of requesting another extension of Brexit from 31st
October to 31st January 2020. This request could be done by Mr. Johnson on 19th October.
However, if the member of the parliament presses on the scheduled Brexit without a deal, he
would have to entertain that.
In case an extension is offered to UK, the extension needs to be agreed upon by all the members
in the EU. Thus, it seems infeasible to receive yet another extension. Los et al. (2017) opined
that it is necessary for UK to reach a deal with the EU. Accommodations and adjustments from
both sides need to be made to design a Brexit deal that is favourable for both sides. It is truly
unrealistic for UK to enjoy all facilities of the union without being a part of it. They must accept
the problems that could arise when they move out of the customs union. However, EU should
entertain the requirements of Northern Ireland by favoring the UK regarding backstop.
Even though withdrawal from the European Union would break a long term of relationship, both
parties must ensure a smooth execution of Brexit.
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Conclusion
From the above report, we could conclude that Brexit is inevitable, and demands from the
opposition could only delay it. However, EU does not wish to extend the date of Brexit any
further. The conflict arising between the UK and the EU law makers are never ending until both
sides decide to compromise their own comfort. The British Prime Minister Johnson is quite loud
in his decision saying that he would execute Brexit even if no ideal deal were reached. A no-deal
Brexit is harmful for the economy of the UK affecting the general masses.
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References
BBC, (2019). A simple guide to Brexit. [online] BBC News. Available
at: https://www.bbc.com/news/uk-politics-32810887 [Accessed 14 Sep. 2019].
Brakman, S., Garretsen, H. and Kohl, T., 2018. Consequences of Brexit and options for a ‘Global
Britain’. Papers in Regional Science, 97(1), pp.55-72.
Colantone, I. and Stanig, P., 2018. Global competition and Brexit. American political science
review, 112(2), pp.201-218.
Dhingra, S., Ottaviano, G.I., Sampson, T. and Reenen, J.V., 2016. The consequences of Brexit
for UK trade and living standards.
Dorling, D., 2016. Brexit: the decision of a divided country.
Hobolt, S.B., 2016. The Brexit vote: a divided nation, a divided continent. Journal of European
Public Policy, 23(9), pp.1259-1277.
Inglehart, R.F. and Norris, P., 2016. Trump, Brexit, and the rise of populism: Economic have-
nots and cultural backlash.
Kierzenkowski, R., Pain, N., Rusticelli, E. and Zwart, S., 2016. The economic consequences of
Brexit.
Los, B., McCann, P., Springford, J. and Thissen, M., 2017. The mismatch between local voting
and the local economic consequences of Brexit. Regional Studies, 51(5), pp.786-799.
Menon, A. and Salter, J.P., 2016. Brexit: initial reflections. International Affairs, 92(6), pp.1297-
1318.
Nytimes, (2019). What Is Brexit? What Does ‘No-Deal’ Mean?. [online] Nytimes.com.
Available at: https://www.nytimes.com/interactive/2019/world/europe/what-is-
brexit.html [Accessed 15 Sep. 2019].
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