Brexit in the Darkness
Brexit in the Darkness
  • 김수민 기자
  • 승인 2016.09.03 09:00
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Brexit is a mixed word that combines the words Britian and Exit. The meaning of Brexit is the United Kingdom withdrawal from the EU. The results of the poll to decide whether or not the UK would withdraw from the EU were announced on the 23rd of June (British Standard Time). The results showed that 52% of UK voters wanted Brexit. With Grexit and Brexit, EU's plan failed.

Grexit means the exit of Greece from the Eurozone. Greece faced financial difficulties because they implemented excessive welfare policies. To help settle this problem, Greece got a bailout from the European Committee, European Central Bank and the International Monetary Fund. The terms of the bailout were a tight-money policy and a tax boost but the Greeks strongly opposed this.

An extension of a relief loan was given to Greece with the terms that it would be nullified if Greece expanded welfare programs which would increase the budget dificit. so Greece departed the Eurozone because of default. The aftermath was felt throughout Europe. In concern about Grexit, Greece submitted an economic reform proposal which reflected the demand of creditors. Afterward, Creditors lowered the danger of Grexit by approving the economic reform proposal. All eyes are now on EU because of two withdrawal affairs from the EU. Grexit's risk was eliminated but the EU once again is in crisis because of the withdrawal of the UK.

There are four reasons that the UK quit the EU. For one things, it is the economic limitation. Finance and trade are the engines of the UK economy. The UK wanted to trade with China but EU disrupted it because China is not a part of the market economy system. The time difference between UK and China caused financial concerns.

EU restricted it because the British business hour was delayed. So the belief that the policies of EU interrupted the development of The UK appeared in the United Kingdom.
The second reason in the limitation of diplomatic leverage. The UK wanted diplomatic activities with many countries because diplomacy operated around finance and trade. But the UK sometimes received interference from the EU because UK belonged to the EU. So other countries didn't make an agreement with the United Kingdom. As a result, many analysts said that the EU prevented active foreign policy of the UK by using a closed policy.

The third reason is an out of control refugee problem. The UK tried to close down their border because they were facing many problems such as a rise in crime, a decline in the quality of the labor market and a lot of discontent. But the EU prevented the border closure of the UK because it didn't agree with their border policies. The EU claimed that there was a freedom of labor tumover' and allocated an amount of refugees allowed in each country. Eventually, the UK couldn't prevent refugee offenders and was in a state of dissatisfaction.

The last reason that the UK left the EU is because of the decreasing influence it had in the EU. Now Germany has leadership of the EU. Although the UK shared the expense of 260 hundred million euros since the regulation of the EU, the influence of the UK in the EU was only 8%.

The withdrawal of the UK from the EU has been rumored since 2013 but the rumor transformed into a plebiscite for withdrawal on June 23rd, 2016. The EU tried to negotiate with the UK but nevertheless, the plebiscite of June progressed on schedule because Johnson, who is the Lord Mayor of London, advocated the withdrawal. But UK has experienced many problems from Brexit.

The Chancellor of the Exchange opposed Brexit because financial companies have to make new agreements and he claimed that the UK would be able to predict the world economy when UK left the EU. The EU propose strategies to solve the refugee, terror and global problems. Although many voices were heard in the UK, the results of plebiscite were the withdrawal from the EU. Afterward, many countries in the EU sought withdrawal as well. And Scotland has declared that they will leave from the Commonwealths if UK leaves from the EU.

The results of Brexit has had an effect on the world. The pound-currency and Euro fell sharply shortly after announcement of Brexit. It has put pressure on the EU to squeeze the UK or many countries may leave the EU as well. The exchange rates will be kept for one or two years with the current level.
On the other hand, the dollar and yen rose sharply. Many investors bought the dollar and yen because they were stable/ For the rising yen, Japan had enough damage in trade.

The UK strongly made their voice heard to EU though Brexit. It is not a formal withdrawal. If the United Kingdom left formally from the EU, the world's stock markets would experience a severe recession.


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