International Management: Analysing Brexit's Impact and Solutions

This report provides an analysis of Brexit, examining its origins, impact, and potential solutions within the context of international management. It begins by defining Brexit and outlining the reasons behind the UK's decision to leave the European Union, including the European debt crisis, economic co...Read More

Running Head: MANAGEMENT 0
INTERNATIONAL MANAGEMENT

MANAGEMENT 1
Table of Contents
Analyse Brexit............................................................................................................................2
Impact of Brexit.........................................................................................................................3
Solutions and Recommendations...............................................................................................5
Reference List............................................................................................................................6

MANAGEMENT 2
Analyse Brexit
In general term, Brexit is a term that can be blended in two words “Britain” and
“Exit”, refers to the UK leaving the EU (European Union). In 2016, a public vote was held
where nearly 17.4 million individuals opted for Brexit constituting to 52 per cent in contrast
of 48 per cent for remaining (Mueller, 2020). However, to understand and analyse Brexit, it is
firstly important to know about the European Union. It represents a political and economic
union of 28 European nations where the member countries enjoy various benefits in terms of
free trade of goods, movement of people as to where they want to live or work in any of the
member countries. There are many reasons for the Brexit to come into existence and why UK
wants to exit from the EU.
The first reason is the European debt crisis which is taking place since 2009 and
various nations such as Greece, Spain, Ireland and others were found to be incapable for
repaying the government debt. These countries started demanding money from the financial
stable member nations of EU such as UK, Germany and France and in this respect, there is a
though come to the UK that “Why should we have to pay for that”? The next cause is related
with great recessions effects arise in 2008, however, that time, UK seeks to grow by 3% per
year (Hossain and Mohammed). There is also a safety concern for European Refugee by the
UK as when they arrive in the EU from across various parts of the world can allow moving
anywhere in the member nations.

MANAGEMENT 3
The next reasons were the high membership fee as the countries would no longer add
to the EU budget resulting in immediate cost savings. Increase in immigration is also creating
challenges for Britain as under EU law, most of the citizens coming to live in the UK
specifically from the eastern and southern Europe. At last, sovereignty is also an important
issue for Brexit creating upsurge of nationalism across the world and ultimately, it has
created increasing disbelief of international financial, trade, and defence enterprises
developed afterward the World War 2.
Impact of Brexit
The impact of Brexit can be seen both economically and financially. In relation with
economic impact, there may be a negative impact of Brexit on the UK in both medium and
long terms considering the economic growth, GDP and other factors. The U.K has already
impacted from Brexit where the economic slowdown is also noticed, companies are shifting
the headquarter to the EU and some consequences has also been placed on the growth, jobs
and trade. For the UK, Brexit comes as the biggest damage to its economic growth like the
growth of the country as of uncertainty over Brexit slowdown from 2.4% in 2015 to 1.5% in
2018 (ons.gov.uk). The government of the U.K. also projected that it will further go down by
6.7% over 15 years. Moreover, on the day of poll, there is a fall in the British pound from
$1.48 to $1.36 the next day. It aids in the country exports however creates several challenges
in imports. In terms of trade, the price of imports will be increased as of tariffs into the U.K.

MANAGEMENT 4
and it may be threatening for the citizen of U.K. in terms of inflation and lowering of the
standard of living.
The younger employees of Britain also discover challenges due to Brexit and it is
projected that there will be a labour shortage of 3 million skilled employees by 2030 in
Germany and thus employers will found difficulties in finding applicants (Bean). Ultimately,
there will be three tough decisions on the U.K. as of Brexit vote. Firstly, leave with no deal
considering deprived of a trade agreement, ports would be gridlocked and carriers stranded
causing trade in drugs and foods shortage. Secondly in terms of vote again on Brexit, the
European Court of Justice governed that the U.K. could individually withdraw its Brexit
request to continue to be as the part of EU in 2018. Thirdly, approving a negotiated deal
while seeing up the nature of the border amid the EU Republic of Ireland and the U.K.
Northern Ireland.
The consequences of Brexit can also be seen for the EU like vote of Brexit has
supported anti-immigration parties’ all over Europe and if they will receive sufficient place in
Germany and France, they will get the power to en-force an anti-EU vote and ultimately, if
one or the other of those nations gone, the EU would be defeated its most strong economies
and would disband.

MANAGEMENT 5
Solutions and Recommendations
Today, the UK is no longer a member national of the European Union and now there
are some practices through which current and future possible challenges can be addressed
well such as negotiations. It will require trade-offs and the government now have to make
choices between aligning the current EU rules and enable more trade and regulatory
autonomy and make control over UK national activities. In addition, the government should
start creating new policies in ranges where the EU has go with an important role under the
leadership of president and while committing to maintain and reinforce the greatest standards
that EU membership proposes.
The immigration should also be one of the prior focus of government as its related
changes can be rapid. It requires the government to devise and implement a new, points-
based immigration system while identifying potentially disruptive to industries that presently
rely upon a firm labour supply from the EU. It can also be seen that Brexit has caused a
negative effect on the UK manufacturing and numerous sectors output and for now, the
outward verdict by the government to line up controlling sovereignty implies that even a free
trade contract would bring new barricades to trade. All such practices will help in addressing
the challenges on much a wider scale.

MANAGEMENT 6
Reference List
Bean, Sara. “Global talent crunch will include UK workforce deficit of nearly 3 million
employees by 2030.” insight 3 May. 2018. Web. 31 Mar. 2020. <
https://workplaceinsight.net/uk-will-have-a-workforce-deficit-of-nearly-3-million-
employees-by-2030/>.
Hossain, Mohammed Sawkat. "Brexit: What Next? A Critical Analysis." Journal of the
International Academy for Case Studies (2019).
Mueller, Benjamin. “What Is Brexit? And What Happens Next?.” Europe 31 Jan. 2020. Web.
31 Mar. 2020. <https://www.nytimes.com/interactive/2019/world/europe/what-is-
brexit.html>.
ons.gov.uk. “Gross Domestic Product: q-on-q4 growth rate CVM SA %?.” Office for
National Statistics 11 Feb. 2020. Web. 31 Mar. 2020. <
https://www.ons.gov.uk/economy/grossdomesticproductgdp/timeseries/ihyr/pn2>.