Brexit sign is flash­ing

What seemed un­think­able a few months ago looks very likely now, as Britain may vote to leave the EU this week

CityPress - - News - MONDLI MAKHANYA mondli.makhanya@city­

On Thurs­day, Britain’s vot­ers will go to the polls to make what may be their most mo­men­tous de­ci­sion in decades. It may de­ter­mine whether, in fu­ture, they can jus­ti­fi­ably put the pre­fix ‘Great’ in front of their coun­try’s name. The ref­er­en­dum on Britain’s con­tin­ued stay in the EU will have pro­found im­pli­ca­tions for its econ­omy, in­ter­na­tional in­flu­ence, so­cial co­he­sion and political cul­ture.

Driven by a fear of be­ing over­whelmed by im­mi­grants and a jin­go­is­tic per­cep­tion that the once-for­mi­da­ble colonis­ing em­pire has ceded too much power to the EU, the mat­ter has di­vided the coun­try down the mid­dle, with strong emo­tions cut­ting across party lines and so­cial classes.

Cur­rent polls show the exit camp ahead by an av­er­age of 10 per­cent­age points and it is now fea­si­ble that Bri­tons will de­cide to go it alone on June 23. The lat­est one, by Ipsos MORI, says those favour­ing a Bri­tish exit (Brexit) stand at 53% and the Re­main camp have 47%.

Here are the pos­si­ble win­ners and losers if it hap­pens:

The Bri­tish prime min­is­ter has staked his rep­u­ta­tion and legacy on this week’s vote. Cameron took a political gam­ble ahead of last year’s gen­eral elec­tion when he promised the Con­ser­va­tives and the peo­ple that they would have a di­rect say on the is­sue if they gave him a sec­ond term.

Cameron, an ar­dent Re­main ad­vo­cate in a party packed with Brexit-lean­ing MPs and ac­tivists, has now spent the bulk of his political en­ergy this year sell­ing the ben­e­fits of stay­ing in the EU and warning of the dire con­se­quences of an exit. Reel­ing out hard num­bers at every turn, Cameron has told Brits that delink­ing would hurt the tax base badly and ne­ces­si­tate spend­ing cuts in key ar­eas such as in­fra­struc­ture, health, ed­u­ca­tion and de­fence. Should he lose the ar­gu­ment at the polls, his po­si­tion in his party will be hugely weak­ened and archri­val Boris John­son will have his tail up.

Jeremy Cor­byn

The leader of the Labour Party was once a Euroscep­tic, but for very dif­fer­ent rea­sons from the xeno­phobes and Tory con­ser­va­tives. Ac­cord­ing to those who knew him closely be­fore he be­came the party leader, he be­longed to a sec­tion of the left that was sus­pi­cious of the EU. These left scep­tics hold that EU in­sti­tu­tions are un­ac­count­able and favour big cor­po­ra­tions. They also ar­gue that the EU is more heav­ily in­flu­enced by big pow­ers such as Ger­many and France, and dis­ad­van­tage weaker na­tions such as Por­tu­gal and Greece.

But in his po­si­tion, he has been com­pelled to lead the pro-Europe party line. Crit­ics have ac­cused him of be­ing tepid on the cam­paign trail be­cause he doesn’t re­ally be­lieve in the mes­sage. A pro-exit vote will weaken his ten­u­ous hold on the party even more and strengthen those who want him out be­fore the next gen­eral elec­tion.

The econ­omy

Econ­o­mists es­ti­mate Britain could shed be­tween 2% and 3% of GDP over the next decade if the coun­try leaves the EU. This would re­sult from a re­moval of au­to­matic and bar­rier-free ac­cess to the EU com­mon mar­ket, the an­tic­i­pated exit of man­u­fac­tur­ing com­pa­nies that would seek do­mains with the in­cen­tives and ben­e­fits of EU mem­ber­ship, and the loss of en­trepreneu­ral en­ergy of new im­mi­grants. The au­toma­tive, fi­nan­cial ser­vices and in­no­va­tion in­dus­tries are likely to be the big­gest losers.

The pound

When EU mem­ber states adopted the euro in 1995, Britain opted to re­tain its own cur­rency. This was for eco­nomic, emo­tional and na­tion­al­is­tic rea­sons, as stay­ing out would al­low the coun­try to con­trol its own mone­tary pol­icy and be­cause the cur­rency was im­por­tant for the feel­ing of sovereignty. This has helped to main­tain Britain’s dom­i­nance, as the pound has re­mained stronger than the euro. It also helped the UK escape the Greek con­ta­gion of a few years ago. But the cur­rency has taken a pound­ing as fears of an exit spooked the mar­kets. This week, as polls in­di­cated a pro-exit de­ci­sion, the pound fell sharply. Ex­perts now ex­pect a 10% to 20% im­me­di­ate plunge. The most di­rect ef­fect of the exit of one of the EU’s main trade part­ners will be the need to rene­go­ti­ate treaties and trade deals that have been signed with the EU bloc. Agree­ments will then have to be han­dled di­rectly with Britain while those with the EU will have to be restruc­tured. The am­bi­tious past mayor of Lon­don is us­ing the Brexit cam­paign to pave his path to lead­er­ship of the Tories and ul­ti­mately 10 Down­ing Street. A vic­tory for the Leave camp will be a per­sonal vic­tory for him over Cameron. Some of his sup­port­ers might use such a sce­nario to cut short Cameron’s term.

Nigel Farage Im­mi­grants

Be­cause Britain is Europe’s strong­est and fastest-grow­ing econ­omy, im­mi­grants of classes have been flock­ing there from weaker economies on the con­ti­nent. With­drawal from the easy-move­ment regime will dis­ad­van­tage migrants from Europe and those from other non-EU re­gions.

South Africa and the rest of the con­ti­nent Lon­don

Per­haps the big­gest loser will be the City of Lon­don. Britain’s mem­ber­ship of the EU has greatly helped the city ce­ment its place as the world’s fi­nan­cial and ser­vices cap­i­tal, and at­tracted the best minds from EU coun­tries and be­yond. Its re­treat to be­come an iso­lated is­land na­tion will hit this sta­tus hard. Hence new mayor Sad Khan’s en­er­getic cam­paign­ing since com­ing into of­fice in May. The most dis­taste­ful char­ac­ter in Bri­tish pol­i­tics owes his na­tional and in­ter­na­tional pro­file to his in­cen­di­ary ha­tred to­wards im­mi­grants and pas­sion­ate cam­paign for Britain to turn its back on Europe. His overtly racist UK In­de­pen­dence Party has made sig­nif­i­cant gains in re­cent elec­tions, but not enough to be a force in Par­lia­ment. A Leave vote will be a feather in the cap for this sin­gle-is­sue party that has kept the mat­ter alive for years.

Right wing ad­vo­cates ev­ery­where

Right wing anti-im­mi­gra­tion ad­vo­cates such as France’s Ma­rine Le Pen and Holland’s Geert Wilders will pop the Cham­pagne should na­tion­al­is­tic my­opia win on Thurs­day. They will use it as fuel for their cam­paigns to pull their own coun­tries out of the EU, ex­pe­dite the dis­in­te­gra­tion of the union and has­ten a re­turn to na­tional en­claves with tighter bor­der con­trols.

WOR­RIED Cameron David

DIS­TASTE­FUL Farage Nigel

RE­MAIN Cor­byn Jeremy


PRO-EUROPE An­gela Merkel

TAIL UP Boris John­son

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