What Is Brexit And How It Can Impact British Economy

Below you will find a quick guide that will help you to understand what is now happening between the European Union and the United Kingdom and what consequences it may have.

What is Brexit?

It is just a word which became frequently used to describe the process of the United Kingdom’s withdrawal, merging Britan and exit.

Back in 23 of June 2016

A referendum was held to determine whether Britain should leave the European Union or no. Leave von by 51.9% against 48.1%. The due date was placed on 29 March 2019 which is near half a year from now. The negotiations have been held ever since the referendum on the terms of the UK’s leave.

European Union stands firm against its members withdrawing from the Union and it is reasonable if the UK succeeds what is going to stop other countries from leaving? This led to long and hard negotiations between two sides on how exactly it is going to happen. There is no doubt left now, that Brexit will happen. The argument is more about what the relationships between the EU and the UK will look like after the so-called “divorce” is settled.

What is happening now?

The main question now is whether both sides will reach the agreement in time or not and there are currently two ways where things can go from here. The first way is called “soft Brexit”. A soft Brexit aims to keep the relationships between two parties while keeping Britain in a single market. The single market is why everything was started in the first place. Britain was a member of a free trade area before it joined the EU. In a free trade are countries have the opportunity to trade with each other without paying any common taxes or fees.

The idea of the EU is to allow free movement of goods, money, people or services within the Union. It is possible to start a business anywhere or take a job anywhere within it. The main requirement is one common law to ensure that the quality of the products is at the same level. As time has shown eventually, it generates too many regulations and steals the right for businesses to control their own affairs. Mass migration from poor countries to reach also raised questions about free movement rule.

What happens if no deal scenario takes place?

A “no deal” means that the UK and the EU would not be able to reach the agreement by due time. If negotiations will not end up being successful, on the 29 th of March the UK will leave the EU. Consumers, businesses, and public organizations will have to react immediately to changes. It will lead to huge uncertainties in life in Britain. While the UK will not be obligated by the EU’s rules, it will certainly face their high tariffs.

The price of goods in Britain’s shops will go up as businesses will have no choice but to place tariffs on goods imported from the Union. Some British products may find themselves rejected by the EU as they will need to go through additional certification. Manufacturers may leave the UK and move to the Union to avoid delays in the import of the components. What will happen to people leaving abroad remains uncertain. There are around 1.3 million British residents leaving in the European Union and 3.7 million Europeans leaving in Britain and what happens with their right to leave and work remains unclear.

Conclusion

There is still some time left to reach the agreement until the due time hits. So far, no principal deal has been reached in terms of Britain’s withdrawal. In case of no deal scenario, the country may fall into one of the hardest crises in its history. Recent news has contributed to the hopes that two sides may reach the agreement within the agreed period, though the parties are still divided on a fifth of the detail of the deal.