UK Should Leave soon the European Union. Here is what to know
On June 23rd 2016, citizens of the United Kingdom went to a referendum. On that day, they voted to determine the fate of the United Kingdom and that of the European Union as well, whether to remain in the Euro or whether they will go alone.
Global leaders such as President Barrack Obama have advised the residents to vote against leaving the Euro. On the other hand, local influential leaders such as Boris Johnson, the London mayor has asked the voters to vote for a Brexit.
Opinion polls indicated a support of 47% for UK to remain in the EU against 41% voting for a Brexit. However, the referendum gone in the other way, and the l’Leave’ won with 51.89% of votes.
In December 2019, after years of discussion, Tories win the UK general elections. Brexit is now very, very near.
→ How Brexit, overregulation and US Tariffs explain the current EU weakness
As a member state of the union, UK is mandated at providing liquidity to aid the EU budget. In 2015, United Kingdom contributed £14 billion to the European Union kitty. These are big numbers folks.
It is therefore important to measure the impact of these funds. The best way to do this is to check the return on investment on this cash.
The European Union spending on the UK was estimated at about £4.5 billion. This leaves a net contribution of about £8.5 billion.
Are these amounts of money worth it? It should not be forgotten that for many years, European Union has underperformed expectations.
In addition, the membership of the European Union is usually undemocratic. The European Commission which makes most decisions is usually made up of unelected officials.
The performance of a country is determined mainly by its negotiation power. UK being part of the European Union does not have its own negotiating powers.
The European Union is tasked with negotiating of trade deals. We therefore believe that UK being an independent country will have more negotiating power.
It should also be noted that more than 50% of UK’s exports go to European countries. These years, no revenue is collected when goods move from one European country to another.
A Brexit will enable UK to make money from imported goods from other EU countries.
It’s no secret that London is the biggest financial capital city in Europe. International firms setting businesses in Europe look at London. People against a Brexit argue that this role will diminish if Britain exits the Euro.
However, the fact is that by exiting the Euro, London has a new opportunity to set up itself as the leading city in Europe. It can achieve this by removing the bureaucratic processes that European Union has set up.
By so doing, it can set itself as Singapore which is now one of the leading city in Asia.
As a member state of the EU, any person is free to move into any country and live there. This has surely worked against United Kingdom which receives hundreds of thousands of immigrants from other European countries.
Statistics indicate that there are almost one million Eastern Europeans, Romanians and Bulgarians who work and live in the UK. This is in addition to 800K Western Europeans who work there.
A Brexit will help the United Kingdom better govern their borders by preventing these people from coming to the country. This migration lead to reduced wages among other challenges.
Last but not least, there is an issue of jobs which United Kingdom must contend with. To understand the impact of a Brexit on jobs, it is important to combine three issues: immigration, trade, and investments.
Those who don’t support a Brexit are of the argument that more than 3 million could be lost. All factors held constant, a drop in immigration will lead to an increase in jobs to those people who remained.
However, this situation could lead to labor shortage which will curtain the growth of the economy. Experts have suggested that wages will increase if Britain leaves. This will however be terrible to the employers.