Withdrawal of Britain from EU and its impact on its integration

By Shahzadi Tooba Hussain Syed

Britain is the second-largest economy after Germany in the European Union, a nuclear power with a seat on the United Nations Security Council, an advocate of free-market economics and a close ally of the United States.

Britain will become the first country to leave the 28-member bloc, which has been increasingly weighed down by its failures to deal fully with a succession of crises, from the financial collapse of 2008 to a resurgent Russia and the huge influx of migrants last year. The withdrawal process is expected to be complex and contentious, though under the bloc’s governing treaty it is effectively limited to two years.

Migration is the main issue among other issues. With net migration to Britain of 330,000 people in 2015, more than half of them from the European Union and Mr. Cameron was totally unable to deal with the effective response to how he could limit the influx. And there was no question that while the immigrants contributed more to the economy and to tax receipts than they cost, parts of Britain felt that its national identity was under assault and that the influx was putting substantial pressure on schools, health care and housing.

Scholars are skeptical towards UK in their views, as Thierry de Montbrial, founder and executive chairman of the French Institute of International Relations said that “the main impact will be massive disorder in the E.U. system for the next two years”. Further he said that “there will be huge political transition costs, on how to solve the British exit, and the risk of a domino effect or bank run from other countries that think of leaving.” European Parliament President Martin Schulz in an interview told German public broadcaster ZDF that, “the United Kingdom has decided to go its own way. I think the economic data show that it will be a very difficult way”. European Council President Donald Tusk warned that Britain leaving the European Union could seriously threaten “Western political civilization.” Britain will have to strike new trade deals with Europe and amend its laws that were based on E.U. legislation. It will take a long time to sort all of that out.

Predictions that the E.U. could break apart might be a bit far-fetched, but there certainly are other countries where demands for similar referendums could gain momentum. But many suspect that the European Union may try to “punish” Britain and deter other countries from making their own exit with a lousy deal. However, if the economic fallout is as bad as some have predicted, it’s also possible that European leaders may seek to calm markets with a quick and easy deal.

For EU the loss of Britain is an enormous blow to the credibility of a bloc.  Exclusion of UK from the European Union will create many logistical problems even at present EU is already under pressure from slow growth, high unemployment, the migrant crisis, Greece’s debt woes and the conflict in Ukraine. The vote will definitely shake the grand European vision. It will certainly provide fuel for anti-E.U. politicians all over the continent. Recent polls have shown that countries such as France and Italy want their own votes on E.U. membership, and populists such as the French National Front’s Marine Le Pen have found Euro skepticism to be a powerful message to voters.

For one thing, it’s still unclear exactly what sort of relationship Britain will be able to strike with the European Union. For the time being there are essentially two models ranging from what Norway or Iceland has – in which Britain would be a member of the European Economic Area and essentially keep access to the European common market – to simply no deal at all, falling back on its membership of the World Trade Organization to set terms of trading.

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Shahzadi Tooba Hussain Syed

Shahzadi Tooba Hussain Syed works at Strategic Vision Institute in Islamabad. He can be reached at [email protected]

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