Friday, June 24th 2016, On this historic day Britain voted to break away from the European Union, shattering the unity of a 60-year-old continental bloc, prompting the exit of Prime Minister David Cameron and rattling the world of business and finance.
On the morning after Brexit, it is clear that Western Democracy is in crisis. In these richest countries of the world, the last time democracy looked as fragile as it does now was in the 1920s, and we all know what happened after that. The rise of the rabid right everywhere, from Ukip in Britain to Marine Le Pen in France and Norbert Hover and the freedom party in Austria to Donald Trump in the US, has many of us holding of our breaths about what will come next.
Superlatives such as ‘seismic’, ‘terrible’ and ‘Britain’s Independence Day’ have been used to describe the referendum vote to leave the European Union. It has come as a shock and disappointment to many, including in the world of Finance and Business. But to anyone following the insular impulses of the David Cameron government since 2010, it cannot be seen as anything but a logical conclusion.
There are two big-picture imponderables of the referendum outcome : Given the context of Britain’s long outward-facing history, empire and internationalism, what role does Britain see for itself in future; and the outcome’s implications in the globalized world of finance and industry. London’s pre-eminent position as the capital of global finance is under challenge (threat would be a better word but your choice). When Britain extricates itself after a two-year process, it will no longer benefit from tariff-free movement of goods and capital. The many claims of Brexit benefits made by the ‘Leave’ camp will be put to severe test.
Severe ‘Brexit’ jolt is being felt worldwide as the historic vote brought Amid joy – dismay and triggered seismic tremors in equal measure in politics and business. Uncertainty gripped London and Brussels as the British public voted 52℅ to 48℅ to leave the EU in a record turnout of 72℅. The clearly Dis-United Kingdom appeared set for choppy waters as it begins the process of extricating itself from the 28-member bloc by the end of 2018.
Global financial markets plunged, the pound fell as much as 10℅ against the dollar, the lowest since 1985, and Cameron set in motion the process of electing a new leader of the ruling Conservative Party by October. It’s most likely to be former London mayor Boris Johnson. The fresh vote on Scottish Independence is now possible.
In India, shares fell more than 4℅ on the news but recovered by half after authorities moved to calm investor worries. The benchmark BSE ended 2.2℅ down, it’s biggest single-day percentage fall since February.
In US, Brexit referendum founded echo in Contest. Parallels are being drawn between Britain’s vote to exit EU and the US presidential race – specifically the top issues of immigration and globalisation. And the revolt against the establishment and political elite, which helped Trump vanquish his mainstream rivals and has kept Bernie Sanders in the Democratic race till now.
Now, there is more regret and despondency than joy as Britain is struggling to make sense of Friday’s vote to leave EU, Sparking a series of developments in London, Brussels and Edinburgh, including moves to hold another referendum in Scotland.
Also, German Chancellor Angela Markel sought on Saturday to temper pressure from Paris, Brussels and her own government to force Britain into negotiating a quick divorce from the EU, despite warnings that hesitation will let populism take hold.
Moreover, An online petition seeking a second referendum on a British exit from the European Union has drawn more than 1.6 million names, a measure of the extraordinary divisiveness of the vote to leave the bloc.
With Brexit leading to fear, anxiety’s over future.