Britain after Brexit – brief overview

Author:Suhail Abboushi
Position:School of Business Administration, Duquesne University, Pittsburgh, Pennsylvania, USA
Pages:69-84
SUMMARY

Purpose This paper aims to examine the early aftermath of Britain’s Referendum to leave the European Union. The study addresses three areas: British public opinion and sentiment with regard to Brexit, Britain’s economy and outlook, and migration. Design/methodology/approach The study is exploratory in nature, examining data and information available in a variety of public sources ... (see full summary)

 
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Britain after Brexit brief
overview
Suhail Abboushi
School of Business Administration, Duquesne University, Pittsburgh,
Pennsylvania, USA
Abstract
Purpose This paper aims to examine the early aftermathof Britains Referendum to leave the European
Union. The study addressesthree areas: British public opinion and sentimentwith regard to Brexit, Britains
economyand outlook, and migration.
Design/methodology/approach The study is exploratory in nature,examining data and information
available in a variety of public sources that include government statistics, media reports and scholarly
researchndings.
Findings Analysis of published data and research studiessuggest growing disenchantment among the
public with regard to Brexit and its consequences, economic and cultural inuences on the Referendum,
economicuncertainty and potential deterioration, and oppositionto and moderation in migration.
Research limitations/implications The study has not generated original survey data about
economicand demographic variables that would make possiblestatistical analysis of hypothesis.
Originality/value Recent politicaldevelopments in developed Western societiespoint to a rise in popular
dismay with globalization, regional integration and multiculturalism. The present study explores and
identies some of the reasons for the trend and the potential consequences to breaking up cross-national
alliances as they pertainto the United Kingdom in particular. Similar studiesmay alert policy makers to the
causes andpotential economic and political consequencesof de-globalization.
Keywords Migration, Culture, EU, Trade, GDP, Brexit
Paper type Viewpoint
Introduction
On June 23, 2016, voters in the United Kingdom (UK) voted on the European Union
Membership Referendum, known as Brexit, to determine whether to remainor leave
the EU. Seventy-two per cent of voters participated, with 51.89 per cent voting to leave
and 48.11 per cent voting to remain. Prime Minister at the time, David Cameron,
resigned and was succeeded by Theresa May who called for general election to be held
in June 2017. The idea of Brexit is not new in Britain and had been debated since 2010
when leaders of one political party or the other began advocating in/outreferendum
to determine continuing or discontinuing membership in the EU. In 2015, when the
Conservative Party won elections, the Government reiterated commitment to the
Referendum but only after completing negotiation with EU to obtain new and favorable
terms (Strong Leadership, 2015). Careful reading of the Conservative PartysManifesto
reveals that the party wanted strong changes to EU policies, stronger UK sovereignty,
abandoning EU principle of ever closer union(Ross, 2014), stronger national
parliaments and signicant changes to EU migration policies. The negotiation
concluded in February 2016 but the outcome offered only modest migration
modications, and this was cited by the prime minister as a reason for the outcome of
Brexit Referendum (Parker, 2016).
Britain after
Brexit
69
Received30 December 2017
Revised19 February 2018
Accepted20 February 2018
Journalof International Trade
Lawand Policy
Vol.17 No. 1/2, 2018
pp. 69-84
© Emerald Publishing Limited
1477-0024
DOI 10.1108/JITLP-12-2017-0052
The current issue and full text archive of this journal is available on Emerald Insight at:
www.emeraldinsight.com/1477-0024.htm
Campaign and positions
Preparation for the Referendum was organized in two campaigns, the leave campaign
endorsing a vote to leaveand the remain campaign endorsing a vote to remain. In summary,
the leave campaign argued that EU was undemocratic, the membership reduced national
sovereignty, and leavingEU would allow UK to control immigration and reducepressure on
public services, potentially save billions of pounds in EU membership fees, allow UK to
make its own trade deals and free UK from European judiciary. The remain campaign
argued that leaving the EU might jeopardize UKs prosperity, diminish its international
inuence, jeopardize national security, erode trade privileges, erect trade and investment
barriers and cause a possible economic slump affecting employment and investment and
possible UK isolation and diminished worldwide status (EU Vote, 2016). The leave
campaign may have been strengthened by perception among segments of the British
working class who believed that EU membership did not alleviate their sense of economic
inequality that has prevailed in their post-industrial economy and may have even
aggravated it. Studies haveshown that public perception of economic fairness or unfairness
as measured by income distribution signicantly affects attitude toward economic
integration (Fattore and Fitzpatrick, 2016). Interestingly, statisticspublished by UKsOfce
of National Statistics (ONS) show that income inequality in Britain continues to be strong
and has not improved much under EU integration. Using the Gini Coefcient, a commonly
used measure of income inequality, the coefcient forgross disposable income in 2017 was
around 49 per cent, not far from where it was ten years earlier, when the coefcient was
around 51 per cent. Membership in EU doesnot seem to have improved economic equity in
Britain as measured by continued income inequality especially, when British people
compare their lot to that of other EU peoples, for recent Organisation for Economic
Cooperation and Development (OECD) studies show Gini coefcient in Britain is
surprisingly higher than most other EU countries (OECD Income, 2017). From this
perspective, EU membership did not deliver improvement. Post-Brexit media editorials by
leave advocates and their Membersof Parliament (MPs) point to such belief to explain their
and their constituentsdecisionto vote leave (Mann, 2017).
Within the Referendum campaign, the political parties had varying positions, some
leaned remain and others leaned leave, as listed in Table I. The Conservative Party had
mixed positions with some supportingremain and others supporting leave. In Gibraltar, the
people and the parties faced challengingdilemma due to UKSpain dispute over sovereignty
of Gibraltar and the possibility that leaving the EU would place hardship on the islands
trade with Spain. All parties in Gibraltarsupported remain.
Apart from the political parties, people vote in the four nations of UK showed that
England voted for Brexit by 53.4 per cent, Wales voted for Brexit by a margin of 52.5
per cent (unlike the Party of Wales), Scotland voted remain by 62 per cent and Northern
Ireland voted remain by a margin of 55.8per cent. With regard to preference of the business
community, representatives of major British corporations weighed in on the debate and
most were concerned about the impact Brexit would have on future operations. Survey of
UK businesses showed a strong preferencefor remain, though medium and small companies
were more evenly divided depending on the scope of their operationsbeing local, regional or
global (Farell, 2016). The banking, nance and law industries were outspoken in favor of
remain and expressed skepticism as to whether the City of London would maintain its
enviable status as market leader in global nance. Post-Referendum survey by the
Confederation of British Industry conrms the nance industrys fear and point to the fact
that this industry is more gloomy about the future than it was in 2008 at the height of the
global nancial crisis. Ninety per cent of rms in that industry view Brexit as the biggest
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