What is Brexit?
Brexit is the conjunction of two words Britain and Exit. It was coined by The Economist magazine back in 2012. It describes the anticipated split of Britain from the EU. Brexit is such a commonly used term that it has been added to the Oxford Dictionary.
Will the EU Survive Without the UK?
Yes, the EU can survive without the UK. The two questions that follow from this are. What kind of EU will remain and what kind of Britain will it be. While it is feasible that the split could cause the EU headaches and some initial teething problems. Eventually the EU will bounce back.
In the short term the statistical data will look bad for the EU. Experts believe that the EU will lose 16% of its GDP when the UK leaves the union. This is a straight out fact as that the is the proportion of GDP that the UK made up of the overall EU economy. The UK is the second biggest economy in the EU, under Germany but above France. So anyway you look at it that is a big statistical value to lose. When the UK leaves the EU economy for the first time since inception of the EU28 (the European Union with 28 member countries) will be smaller than the USA economy.
The flip side to this coin is that the UK since about 2007 has been a drag on the EU economy. Economic growth in the EU without the UK will actually be faster. The UK economy has been relatively stagnant since the (GFC) Global Financial Crisis. London’s financial markets were proven to be very vulnerable to the affects of the GFC and have not recovered well. The UK’s manufacturing and exports are predicted to grow slower than the EU in 2019 and 2020, so the overall effect on the EU economy of Brexit will be a positive one. Even if initially the numbers will look worse.
The European Union after Brexit will be a very different beast but probably a more robust, strong and progressive animal.
Will the UK Survive Without the EU?
Yes, the UK can survive without the EU. The UK economy is the 5th largest in the world. This is despite all the pains the UK economy suffered over the GFC. The UK government is attempting forge ahead with new trade pacts with countries like Australia but at the end of the day the EU is the UK’s biggest trading partner. this is not likely to change for decades to come. How will Brexit affect trade? The will be determined by the trade deal the Uk parliament can put in place with the EU. Currently they are not having much success in putting an kind of agreement on paper that is both acceptable to the UK parliament and the member countries of the EU. If this isn’t sorted then Initially trade will take a hit and possibly have a long term negative affect.
Brexit is a force for change in the world. Both the EU and the UK will initially feel some negative affects from the split but will these effects be long lasting? Only time will tell.