BritExit: And Now What…..

BritExit: And now what…

Unless you’ve been living under a rock, last Thursday the people of the United Kingdom voted to leave the EU. However, the formal withdrawal of the UK has yet to be presented (so-called article 50 procedure). 

I must admit that I’d hoped that the UK would stay within the Union, but such is life. You live and learn.

The question now, is how to we proceed.

We are now in uncharted waters.  It’s the first time that a EU member of this significance and power has decided to leave the European bloc. Although its not the first time that a member has left – think of Greenland

What is clear from the BritExit referendum is that the British people are fed-up how the EU functions.

In this context, one could argue that common Europeans view the EU as an institution which is great for solving unnecessary problems, but is unable to solve the problems which common Europeans find necessary.

However, whether the solution is to leave the EU, is another matter. Hopefully, a positive result of BritExit might be that the EU finally starts to act as a bloc in which problems which common Europeans feel necessary for their future and welfare are actually addressed…

BritExit

 

 … and what Now?

On the way forward, its pure speculation what will come now. The initial shock of the decision still has to be processed.

Apart of the reaction of the financial markets to BritExit, which at the end of last week resembled a slaughterhouse, the UK has now only a caretaker government, following David Cameron’s resignation.

For that matter, BritExit has also brought Jeremy Corbyn, leader of the opposition into turmoil. Not to mention a possible constitutional crisis following the possible threat of Scotland’s First Minister, Nicola Sturgeon, to veto the UK’s withdrawal of the EU.  

The debate has started if the Article 50 procedure will even be triggered. Traditional to British conduct towards Europe, the British are keeping their options open, to the frustration of their EU partners. However, let us hope that cooler heads prevail, whereby the realities of mutual benefit trump short-term feelings of rejection and anger. 

For international trade compliance, the question remains what next. From a customs perspective, it must be assumed that the UK will have to adopt it’s own customs laws. In regard to export controls, echoing one of BritExit’s main proponents, the former mayor of London, Boris Johnston, the UK will stay European. This lastly has been confirmed in a statement by the parliamentary UK Foreign Affairs Committee (UKFAC).  

Parliament at WorkThus, not much should change. The UK is a member of the main export control regimes (Wassenaar ArrangementAustralia GroupMissile Technology Control RegimeNuclear Suppliers Group, and Zangger Committee).

Depending on the ultimate deal between the UK and EU, it remains to be seen whether the UK will fundamentally alter its dual-use controls regime. Note that the UKFAC published a report in April 2016 concerning the implications to British foreign policies regarding a possible BritExit. 

With some hindsight, the UKFAC doubted whether the Norwegian or Swiss models could apply to the UK (see report pages 14-15). In essence, both these models give these two countries access to the internal market, but force them to accept EU laws – including the free movement of persons and contribute to the EU budget, without any say. It takes no rocket scientist to conclude that these models would not contribute to bringing back sovereignty which so many supporters of BritExit cherish. 

In regard to economic sanctions, it is to be expected that some changes will be necessary. A BritExit will impact many foreign security policies; being out of the EU, the UK will no longer have to implement the CFSP, whereby it will have to implement its own autonomous sanctions regimes. As a Permanent Member of the UNSC, the UK’s commitment to the JCPOA should not be affected. However, given the significant strategic overlap between the EU and the UK, it will be interesting to see what changes substantively. Although, substantive changes to UK’s sanctions would make BritExit even more outlandish than it already is.

To quote an opinion of Beppe Severgnini in the New York Times, BritExit could be summed up as “[t]o be alone against enemies in 1940 was heroic. To be alone among friends in 2016 would be absurd.”

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