Brexit and its fall­outs

Pakistan Observer - - OPINION - Sa­man Zulfqar

THE poll re­sults in Bri­tain re gard­ing exit from the Eu­ro­pean Union (EU) re­in­forces the emerg­ing thought that forces of na­tion­al­ism are gain­ing im­por­tance. Bri­tain would be the first coun­try to leave EU since its for­ma­tion but ref­er­en­dum does not mean that it would cease to be a mem­ber of EU im­me­di­ately but the process would take min­i­mum two years. Ar­ti­cle 50 of the Treaty on Eu­ro­pean Union es­tab­lishes the pro­ce­dure for a mem­ber state to with­draw from the EU by no­ti­fy­ing the EU about its with­drawal. The ar­ti­cle obliges the EU to ne­go­ti­ate a with­drawal agree­ment with the leav­ing state and once the ar­ti­cle 50 is trig­gered, a coun­try can­not re­join the union with­out the con­sent of all mem­ber states.

When Bri­tain will in­voke Ar­ti­cle 50, it would have two years time to ne­go­ti­ate a new treaty to re­place the terms of EU mem­ber­ship agree­ment. EU and the Bri­tish lead­ers have to sort out is­sues re­gard­ing trade tar­iffs, mi­gra­tion and reg­u­la­tion of other things. The only im­me­di­ate ben­e­fit Bri­tain would have af­ter leav­ing the EU is cost sav­ing as it would no longer con­trib­ute in EU bud­get.

The ma­jor is­sue Bri­tain has to face is re­gard­ing trade, be­ing a sin­gle mar­ket no tar­iffs are im­posed on trade be­tween EU mem­ber states. Bri­tain’s fifty per­cent ex­ports go to EU states. Bri­tain has not only been play­ing role in pol­i­cy­mak­ing but has also been ben­e­fit­ing from trade deals be­tween EU and other pow­ers. Some lead­ers ar­gue that Bri­tain could fol­low the ex­am­ple of Nor­way that is not a mem­ber of EU but in re­turn for abid­ing by a num­ber of EU rules has favourable ac­cess to Eu­ro­pean Com­mon Mar­ket. Given the fall­outs of Bri­tain’s exit from EU and se­ri­ous chal­lenges faced by unity of EU, Bri­tain may not get a more favourable agree­ment be­cause it may em­bolden the crit­ics in other EU mem­ber states who also de­sire to leave the EU.

EU of­fered greater ben­e­fits for im­mi­grants and busi­ness com­mu­nity. Since join­ing the union in 1973, the UK at­tracted thou­sands of im­mi­grants from the EU states. As a sin­gle eco­nomic mar­ket and supra­na­tional po­lit­i­cal body EU has been re­spon­si­ble for leg­is­lat­ing and im­ple­ment­ing eco­nomic re­forms for the union. This fact re­sented the Boris John­son, for­mer London Mayor and front-run­ner to be the next Prime Min­is­ter has been the lead­ing sup­porter of leav­ing the EU. He said that Bri­tain now had a glo­ri­ous op­por­tu­nity to pass its own laws, set its own taxes and con­trol its own borders. The pound fell to its low­est level against the dol­lar since 1985 and in the com­ing weeks, the un­cer­tainty re­gard­ing pre­car­i­ous eco­nomic sit­u­a­tion may af­fect fi­nan­cial po­si­tion of UK as the fifth largest econ­omy.

The im­pli­ca­tions of Bri­tain’s exit would be far reach­ing; the global fi­nan­cial mar­kets would sta­bi­lize soon but deeper im­pli­ca­tions of Bri­tain’s exit for EU, these would be im­mense. EU has been a sym­bol of in­clu­sive pol­i­tics and shared val­ues for the rest of the world. Ini­tially, its suc­cess as an eco­nomic re­gional bloc and later on its en­hanced po­lit­i­cal clout in global af­fairs has been defin­ing fac­tor in inspiring de­vel­op­ing states to form re­gional unions like EU. How EU would be able to main­tain its unity as a re­gional bloc and how would it ex­ert its in­flu­ence in global af­fairs be­cause EU-3 (Bri­tain, France and Ger­many) eco­nom­i­cally and mil­i­tar­ily are among the lead­ing coun­tries and these three states are the core (cen­ter of power) in EU. Bri­tain and EU both have to face this dilemma.

The polling re­sults showed po­lar­iza­tion and so­ci­etal di­vide among the peo­ple. Ma­jor­ity of younger gen­er­a­tion voted in favour of EU mem­ber­ship while older peo­ple voted in favour of leav­ing the EU. Sim­i­larly, Scot­land and Ire­land favoured the ‘re­main camp’ and Scot­land’s First Min­is­ter in­di­cated that Scot­land may call for a sec­ond ref­er­en­dum for in­de­pen­dence. Apart from fac­ing in­ter­nal chal­lenges, Bri­tain has to re­lo­cate its po­si­tion and po­lit­i­cal sta­tus in the global hi­er­ar­chy of power. How it is go­ing to as­sert it­self in the global pol­i­tics? — The writer works for Islamabad Pol­icy Re­search In­sti­tute, a think­tank based in Islamabad.

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