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Brexit Consequences for UK if Boris Gets His Way

It might seem hard to believe that the referendum that sparked Brexit was three years ago. After struggling with and failing to get Parliamentary approval on a plan, former Prime Minister Theresa May resigned in June. Boris Johnson has now succeeded May and has promised to fulfil Brexit by the deadline of 31st October – deal or no deal.


This does not constitute advice and advice should be sought in all instances before acting on it.


There are three possible outcomes that we could be facing in a matter of months:

  • The first option is a “no-deal Brexit,” which has Britain leaving the EU without a formal trade agreement.
  • The next option is a “hard Brexit” which implements a new free trade agreement.
  • The final option is to move forward with May’s Brexit deal (or a renegotiated version).

No deal Brexit

Leaving the EU without a trade agreement would essentially cause short-term chaos as it would do away with Britain’s tariff-free trade status with other EU members. The financial implications of this outcome are enormous as increased import tariffs would be passed along to consumers.

One-third of the UK’s food  comes from the EU, so higher prices would increase inflation and lower the standard of living in the country. Exporters would also suffer as their goods would be experience the same hike in Europe. Johnson has warned companies to prepare for this outcome.

A once “borderless” Europe would be a thing of the past. All goods would now need to go through customs; border delays coupled with natural weather patterns such as heat waves, droughts, and global warming could mean food shortages.

Trade and travel on the Irish isle would become cumbersome with the new border and the threat of returning to the days of conflict could be very real. Commuters would now need to pass through customs daily and it might even spark a referendum to reunite Ireland.

Furthermore, Britain would need to settle its outstanding debt to the EU (an estimated 51B euros) and the UK would also have to guarantee rights to EU citizens already living in the country.


Hard Brexit

Very much similar to a no-deal Brexit with the exception of the inclusion of a trade agreement, which has very little chance of being developed and agreed upon by the October deadline. The key impact here is that services would be lost or price-gouged – popular commodities such as airfare, internet, and phone services could all skyrocket.

This option does not bode well for the UK’s financial centre, The City, as it would no longer be used as the English-speaking entry point into the EU. Thousands of jobs could be lost and real estate could take a nosedive. Both commercial and residential properties in development could be abandoned and some businesses have already jumped ship while house prices are starting to decline.

We’d lose out on the state-of-the-art technology coming out of Europe and no longer be able to bid on public contracts, normally open to any EU member country. The banking sector would be hardest hit as banks would no longer be able to operate outside of the UK.

The freedom for labourers needed both in country and in Europe to freely cross borders and find work would be gone. Adding insult to injury, Scotland could opt out of being a part of the UK and join the EU on its own.


May’s agreement

Under May’s plan, the UK would remain within a “customs” union with the EU for an undetermined amount of time, letting trade continue as normal. EU workers currently living in the UK could continue to work without worrying about a visa and the same kindness would be returned to UK nationals living and working in European countries.

This iteration does not prohibit the “free flow” of immigrants from the EU, which was reported to be the main reason so many were in favour of Brexit in the first place. Additionally, the UK would still need to follow EU guidelines and pay EU exit fees, but since the UK would no longer be a part of the EU, it would have no say on what those guidelines would be.

One big sticking point of this deal was the unsatisfactory resolution to avoiding having a border between Northern Ireland and the Republic of Ireland.


Foggy future

Uncertainty over the future of the UK and the EU has already impacted the economy. Growth slowed to 1.3% last year and companies from the US and Europe are relocating headquarters outside of the UK. The pound is 14% lower than before the referendum but experts predict the pound will strengthen after a deal is reached.

There are consequences for all possible outcomes surrounding Brexit, and there is still no sign as to which result we’ll be dealing with come October. We’ll be sure to keep an eye on any developments and relay the financial implications to you – so watch this space.


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