Monday, 8 August 2016

Brexit, European Union and The World

The European Union originally established as European Economic Community in 1957 by Treaty of Rome and continued with some major and minor changes till 1993 when Treaty of Maastricht formed European Union (EU). It is World's largest common market for trade, services and goods incorporated by a common trade policy. EU citizens can work, move and live anywhere in Union due to Schengen Agreement which opened borders.

Britain applied for membership in 1963 and 1967 but was vetoed by Charles de Gaulle (French President), another appeal was made in 1972 which was accepted and Britain entered the common market in 1973. A referendum was held back in 1975 in the UK asking for its stay in EU which was accepted by 67% people.

Citizens together living in harmony, exploring every corner in EU, strong trade links in the market, everything was going fine. So what caused disruption.

Causes of Brexit - 

  • In immigration of people from another less developed countries within EU were causing a financial burden on government and compensating with jobs defined for natives.
  • Sovereignty, the actions and voting in EU, Island Nation is given only a small share besides it is the biggest market for goods and services. Also, due to the entry of newer nations as were denied by Britain.
  • Rising lone wolf attacks and increasing terrorism in parts of EU due to ISIS also warned officials about porous borders and absorption of refugees.
  • Negative effects of Greece's economy and economic slowdown in EU has greatly affected its largest trade partner which was to repatriate for the loss.

The Referendum -

In 2012, David Cameron suggested for a referendum in nearby future related with UK-EU relationship. The ultimate fate was decided on Thursday 23 June 2016 with a turnout of 72%, which was in favour to leave EU by 52%. Political and economic turmoil was visible and British Prime Minister David Cameron resigned as was told in his manifesto followed by Theresa May of Conservative Party. Now for the UK to leave, Article 50 of Lisbon treaty needs to be invoked giving both the sides 2 year time to negotiate the agreements on terms for an exit.

After Effects -

  • The immediate effects were seen in the financial market followed by falling of sterling to 31-year low. The biggest blow to importers was seen.
  • In short and medium term, new trade agreements can be made and ratified, immigration norms to be re-validated and cancellation of Schengen Agreement to take place.
  • In the long term, the situation can turn back to conventional with a deep scar in global history, signing to new multilateral agreements, bonds and promoting can help to regain for lost.

Written by Kartikeya Gupta
An engineer by profession, INDIAN by heart and Aspiring Officer by Choice(IMA). Snooker, Gym, Video Games, National International Affairs, Web Development. And much more.

Back To Top
For Editorial Submissions, Business Inquiries or any other query, do write to us at

Copyright © 2017    ReviewMantra |  Terms of use  |  Privacy