BREXIT, a word that people have been hearing for the past two and a half years. While the word itself had lots of weight the first time it was coined, it lost some in the long time which passed from when it was first uttered.
BREXIT is a combination of two words, Britain and exit, signalling the desire of the British to leave the European Union, after being a member for longer than two decades. Brexit was approved of in 2016 and was given a two year period to materialize, that period ending on March 29 2019, which was later extended to October 31 2019. BREXIT is imminent, but how will that affect the economy of the world?
Companies are Looking Past Britain to Invest Elsewhere
The British will suffer the most from BREXIT, but other companies now have to look elsewhere, as Britain will obviously be a very unstable ground for any kind of investment in the years to come.
The slow BREXIT is a very bad thing, due to political uncertainty. The trade between the UK and the European Union still remains relatively normal, but it will have to break at some point and the economy of the UK will come to a full stop, meaning that one of the crucial elements of economy will stop working for a while.
This will affect Britain the most, but any company doing business with the UK will also be affected, from investors, online casinos, and every other company doing trade of goods or services with the UK.
Trade Routes Will be Disrupted
It makes sense that the UK will be doing a lot of trade with its neighboring countries, all of which are in the European Union, except Norway. Yes, there is a sea between them yet water trade routes are an important part of the economy of the UK and while trade with Norway might not be affected, the rest of the countries will definitely have to stop and rethink and wait for the UK to stabilize. Even though an economic hiccup has not really happened, almost every analyst expects it to happen.
UK-Based Businesses are Weighing Anchors
Businesses which are based out of the UK but which operate globally are rethinking their position and slowly starting to move their assets elsewhere. That means less money for the UK and more trouble for every UK-based business which operates on a global or continental scale.
If BREXIT accelerates, these companies will also pick their stuff up and leave, as it is better to start anew in a stable environment than remain in a volatile one. The costs of a new office can be predicted while what is to come in the UK is largely unpredictable.
The global economy won’t suffer a lot because of BREXIT but the UK certainly will. Companies doing business with the UK will most likely have to either wait a while or find new partners, but that can be done while waiting for the imminent BREXIT and economy jumble.