29 Mar 2017

The Brexit challenges for Theresa May

The most important day for Great Britain, after WW2, has arrived. Theresa May has signed the letter that will be delivered to the hands of the president of the European Council Donald Tusk, officially triggering article 50 of the Lisbon treaty.

The letter signals the start of the negotiations between the European Union and the United Kingdom for Brexit. Tusk will prepare a draft copy of the EU’s negotiating guidelines which will be formally adopted by EU27 in a special summit on 29th April. On the other hand, the British prime minister should prepare its cabinet for a difficult period of negotiating the best deal for the country. Brexit is going to have both positive and negative impact on Great Britain.  Here are some pros and cons.


Country control: During the period before the June referendum, one of the slogans that Brexiters were using to promote their cause was “Take Back Control”. The outcome of the referendum did exactly that. Britons are taking back control of their country, after many years of being a part of the EU establishment. Great Britain, as one of the founders and most prominent members of the EU, had to share powers with Brussels. Some Britons were frustrated with the bureaucratic procedures that Brussels had imposed and it seems that it is time to give an end to that. Great Britain will be free to do what it wants, how it wants without having to inform the EU about its actions.

Immigration: One of the key reasons for the referendum result was the will of the Brexiters to bring migration down. According to the Migration Observatory at the Oxford University, between 1993 and 2016, the foreign-born population in the UK more than doubled from 3.8 million to 8.7 million. During the same period, the number of foreign citizens increased from 2 million to more than 5 million. 3,2 million EU citizens live and work in the UK currently. With British economy being rather unstable, the influx of migrants from Europe and other continents has made many Britons seeking ways to control it. Brexit gives the chance to the government to put limits on migration and satisfy the voters.

Economy-trade: Great Britain is selling 44% of its total exports to the EU. This is 11% less than the previous decade, indicating a rapid decline in numbers and the economy drifting away from the rest of the continent for quite some time. Some analysts foresee a further reduction of the exports to the EU in the next decade. Until now, Britain also had to import products such as fruits, vegetables etc. respecting the rules and the regulations of the EU. The new reality won’t include Brussels telling Britons how to import or export products.

The British government has shown its will to forge new bilateral trade relationships, which it couldn’t do separate from the EU until now. Great Britain has made clear that it will seek to refresh the relations with the countries of the Commonwealth, in order to gain access to new markets that had been abandoned because they had been replaced by the EU ones. British officials believe that new deals are going to create new jobs for Britons and increase the production output of the country.


British expats in EU: There is an estimated 1,2 million British citizens living in the 27 countries of the EU. Most of them are working for international companies or they are pensioners enjoying their time in the southern Mediterranean countries such as Spain, France and Cyprus. Until now, the only thing that a Briton should do to live like that, was having a valid passport. Britons could enjoy the benefits of their country being a member of the EU. Now, the future is very uncertain. British expats organisations are lobbying to press the EU and the UK to respect their rights and to let them live and work as they are used to.

Jean Claude Juncker, the president of the European Commission, has said repeatedly that he is going to protect the rights of the British expats in the EU, because he doesn’t want their human rights to be harmed. However, in case the negotiations don’t turn out well, no one knows how these people could be affected.

Exit bill: During their campaign, Brexiters were saying that the UK pays a disproportionate contribution to the EU’s budget. They argued that leaving the EU would result to significant cost saving for Britain, which could be invested in the country’s industry or infrastructure. Brexiters neglected to mention that, in 2015, the UK contributed £13bn to the EU’s budget and received £4.5bn worth of spending. This means that the UK’s net contribution was £8.5bn, which is 7% of the NHS budget each year.

The United Kingdom is going to have to pay an exit bill. Rumors circulating media talk about £50-60bn in a one-off payment. The UK government hasn’t denied the payment obligation, but it has expressed the will to negotiate the price. Some EU members have been very strict in this matter, demanding from the EU institutions to “punish” Great Britain for exiting the Union. Michel Barnier, the chief EU negotiator for Brexit, has said that the accounts between the EU and the UK must be settled.

Scotland: Nicola Sturgeon has announced that Scotland wants to stage a second independence referendum. The First Minister said that the Scottish people should have the right to decide for their future since the UK is leaving the EU. Sturgeon says that Westminster refuses to give powers to Edinburgh and that, in her opinion, Scotland should remain within the single market. Theresa May has refused to talk about a new referendum saying that “this is not the time.” It is certain, that despite May’s opinion, the referendum will take place sooner or later. If the Scottish vote to become independent, this means that the UK government will have to deal with another significant problem, during the time of adjustment from leaving the EU.

Little Britain?: 52,5% of the voters wanted for the United Kingdom to leave the EU. This is truly a majority, but not so strong leaving the other half dissatisfied with the outcome. The nation is divided and as long as Theresa May’s government doesn’t present clear plans about the future, the fear is getting stronger. Many Britons believe that the United Kingdom will enter a period of isolationism and, possibly, economic recession. Even Brexiters didn’t like the David Davis statement about migration rising after Brexit, because the industry needs the knowledge and the working hands of foreign migrants. In a period that alliances are shifting and populism rises, Britons are afraid that Little Britain might become a harsh reality.

The maximum time for negotiations between the EU and the UK can be 24 months, starting from today. Both sides have expressed the will to make a good deal that will help citizens and the countries’ economies. If in 24 months, a deal is not made this will mean that the UK will be travelling to uncharted waters, despite what Boris Johnson says. It is up to Theresa May to handle the situation with the best possible way.