Brexit remains the hangover everyone is the country is going through, without the good night before. As the exit date draws ever closer, the news continues to be filled with ‘soft’, ‘hard’, ‘Project Fear’, ‘negotiations’, etc, most of which has been falling on deaf ears as the extremes of either side continue to fail in getting what they thought they would.
Eventually, the cold grey dawn of a new existence outside of the world’s largest trading bloc will make it through to those who think that Brexit has no bearing on everyday life. While talks of personalities and Chequers deals dominate the headlines, behind the scenes the facts have not much changed, leaving those who care to look with the vision of a potentially daunting future.
These effects largely begin with trade. In 2017, 44% of UK exports in goods and services went to the EU, equating to roughly £274 billion, while 53% of imports came from the EU. This suggests a trade deficit with the EU at about £67 billion. Brexiteers might claim this to show that the EU needs the UK as an export market more than the UK needs the EU, but when looking at the bigger picture this is not the case.
Those 44% of UK exports were equal to about 13% of the UK economy ,while the 53% of UK imports accounted for 3-4% of the EU economy. While in the past the UK used to be the biggest export market for EU goods, this changed in 2015 when the USA became the biggest, with €369 mil in goods exported.
Brexiteers have claimed that there are plenty of countries lining up to do business with the UK. So who are these countries? The US is keen to do a deal, but only if the UK significantly reduces its welfare and hygiene standards for farm animals. Chlorinated chicken and hormonally expanded beef would likely be imported. The NHS would have to open up to competition from private US healthcare firms. Data laws could risk being circumvented as a result.
China is noticeably less enthusiastic about UK trade since the Brexit referendum. Japan has already said that it would prioritise EU deals ahead of any with the UK – thought they have recently been warmer. Canada would be happy to make a deal but any new trade deal would essentially be a replication of the current deal so no offer any advantage. India’s economy is due to overtake the UKs in the next few years so EU deals are more advantageous.
The South American trading bloc, Mercosur, would be interested in making deals but this would likely involve opening up the beef market, potentially flooding the UK with cheap South American beef, affecting the UK beef industry. Mexico has just completed a deal with the EU so any future deal with replicate a current deal, once again providing no real advantage. Australia has been touted as keen to deal but its economy is much smaller than the UKs and so offers no real advance and advantage.
When moving to strike new trade deals, free trade agreements provide protection for UK companies. Free Trade Agreements (FTAs) provide an arbitration mechanism allowing any side that breaks trade rules to be sanctioned and punished for such actions, as well as protecting companies during disputes and legal issues. While in the EU, the UK has the protection of the European Court of Justice to back it up, but once the UK leaves the EU, such protection and back up will no longer exist.
A large focus in the Brexit referendum also fell on the NHS or, rather, the promises made to help it in years to come. Use of the NHS by foreigners, or health Tourism, has long been a cause of disagreement. The assertion is that foreigners cost the NHS vast amounts of money, affecting the overall cost and capabilities of the service. A study by the King’s Fund, an independent think tank, found that while health tourism did affect the NHS, it was by no means the leading cause. Top of the list was rising costs and wages at £2.8 billion. While additional people could affect this using the NHS, more foreigners is not enough to cause such a rise. This rise is likely attributed to rising living costs, inflation and increase in wages according to incremental wage structures, while the markets will always threaten to increase the price of goods. The NHS is already suffering from Brexit, but other factors have long added to the ever-growing mound of misery that healthcare officials have to climb over every day.
The shortfalls in the health and social care sectors are beginning to show. Over 15,000 beds have been lost in the last seven years, taking the UK to the second lowest number of hospital beds per head in Europe. There is uncertainty over the UK’s 55,000 foreign NHS staff. Many remain hopeful that the UK will remain in the European Medicines Agency (EMA), which has already decided to move to Amsterdam. Leaving the EMA risks leaving UK patients behind the curve and availability of new medicines.
The least tangible – but perhaps the most toxic – effect of Brexit is the manner in which it has already tarnished the image of the UK, in the eyes of industry and, perhaps more importantly, in terms of how its citizens are perceived. Every incident of racism, xenophobia, and anti-EU sentiment echoes more loudly than it did before. Debating the referendum has become even more vital for some while boring and tedious for others.
Brexit and its effect on the UK is, for the moment, near to impossible to predict. For all the many views of different think tanks, government officials and of the public, no one knows for sure what will happen. Nevertheless, the effect that it is having now is negative. The pound fluctuates wildly, industry leaders are uncertain whether to stay or go, Brits living abroad are beginning to return and the political establishment is starting to crumble under the strain of arguing. Whatever the outcome, in many ways it will be a relief because then, at least, the country can perhaps start to heal and figure out what is required to lift it out of the doldrums.
Has Brexit actually resolved any of these problems yet? People of different nationalities, culture and traditions and of, let us be honest, different skin colour, continue to come to the UK to seek work. They join a society and contribute, just like anyone else. They pay tax, mow their lawns, spend money in the local and national economies, eat, pray and sleep. So at what point did they become ‘they’? When did we consider an ‘outsider’ to be incapable of acting in the same way as ‘us’? Trade and healthcare are important pillars of a society. Without them succeeding, the society faces new struggles. The results of the referendum, and what the future holds, become the responsibility of the people. You cannot get more democratic than that.
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