The relationship between Britain and the European Union (EU) is like that of a spouse. They have been forming a close partnership for 46 years. Although not so satisfied with each other now, it is still difficult to say goodbye.
In a bid to leave the EU, British Prime Minister Theresa May had requested to extend the Brexit deadline from March 29 to June 30 this year. The EU member states convened on March 22 to discuss the issue. They thought that the present political crisis in Britain poses a great threat to the world’s biggest trading bloc. The EU leaders thus rejected May’s request. They set two optional deadlines for Britain to leave or to take an entirely new path in considering its future ties with the EU. They agreed to delay only until May 22, on the eve of the EU elections, if May can persuade Britain’s Parliament to endorse her Brexit deal. Failing to do that, Britain would have until April 12 to offer a new plan or choose to quit without a treaty.
May said she was satisfied with the outcome and was confident to secure a deal in the near future. Frankly speaking, conditional postponements of the EU gave May some breathing space, but it is still humbling for a leader who has spent more than two years in vain telling its people they were planning to exit the EU on March 29, 2019, the day written into law for Britain to leave the largest trading bloc in the world.
Deep divisions and conflicts over Brexit at the heart of Theresa May’s government were dramatically laid bare as discipline broke down and Cabinet ministers openly defied the prime minister in recent parliamentary voting rounds. Members of the Parliament have several times rejected the prime minister’s proposals. On March 20, May outraged many lawmakers by publicly criticizing them for the deadlock. Some hardliners have even been pressuring May to decide the date she will step down in return for their support.
Lawmakers rejected May’s Brexit deal for a third time on March 29, raising the chances of a lengthy delay to Brexit or Britain crashing out of Europe without a deal on the new deadline of April 12.
The Brexit deal has been choked chiefly by disagreement over the so-called Irish “backstop,” a measure to keep trade flowing and avoid friction at the border between Northern Ireland and the Republic of Ireland.
In my point of view, business leaders understand better than anyone else the impact of the changes brought by Brexit. Anxious businesses in Britain are pleading for action. U.S. President Donald Trump even said he was “surprised to see how badly Brexit has gone.” Irrespective of what the Brexit deal produces in the future, the uncertainties over Brexit have already posed some negative influence on the British economy. First of all, London’s status as the No.1 international financial center has suffered. The U.K. has for many years been proud of itself for being the center of global financial industry and the home of Euroclear — Europe’s financial clearing house — and the European Banking Authority (EBA). However, the EU has decided to move the headquarters of EBA from London to Paris and relocate Euroclear to another part of the continent. Some large banks and financial institutions are also planning to transfer their huge euro assets to other European cities such as Frankfurt and Dublin. For example, Morgan Stanley, Goldman Sachs and JP Morgan are shifting their businesses to the German city Frankfurt.
The uncertainties over Brexit have also affected Britain’s domestic market, especially the goods, service and consumption sectors. For instance, what will be the trade relationship between the 27 other EU nations and the U.K. after the latter ceases to be a member of the EU Customs Union? Due to a lack of confidence, even the Bank of England has cut Britain’s expected growth rate in 2019 from 1.7 percent to 1.2 percent and predicted a lousy global market because of Brexit.
No road is perfect and every course creates both opportunities and risks. The full impact of Brexit is not yet clear and some insiders expect the U.K. to become more dynamic and competitive after exiting from the EU. But it will still take a lot of time to see what Brexit will actually bring about for Britain and its people.
(The author is the editor-in-chief of the Shenzhen Daily with a Ph.D. from the Journalism and Communication School of Wuhan University.)