Brexit: no panic?

Just days before the referendum vote in the United Kingdom , the economic and political landscape of Western Europe is changing dramatically. Through complementary articles, we will attempt to analyze what is happening in the UK and the rest of Europe following the referendum result ( Brexit ), which sees Great Britain leave the European Union after twenty-three years of existence.

Possible reasons for this result

The widespread discontent of recent years has led the English and Welsh populations to reify their fears and concerns about a European Union policy dictated by Germany and France. Although the United Kingdom has not been affected by the economic and financial crisis, and unemployment rates have never exceeded 5% during these two decades, the secondary effects of austerity policies on Mediterranean European nations have resulted in a large and uncontrollable migration from southern European countries to England.

Fear of terrorism, fomented by the media and by British foreign policy itself, is resulting in the abjuration of signed treaties, among which the Schengen Agreement and the Dublin Convention stand out for their implications for migration . The former recognizes the right to the free movement of people, goods, and financial capital; the Dublin Convention requires the first nation to which refugees arrive to host and grant them asylum.

Thus, in one fell swoop, Great Britain returns to being an archipelago detached from the rest of Europe. This is an identity-based vote, likely seen as a xenophobic or autarchic approach to the complications arising from the progressive collapse of European states' national sovereignty in favor of a centralized policy, driven by a Germany that claims legitimacy as such and without much justification.

Nearly half the population voted to remain. They are mostly young, well-off, and academically educated: the people least affected by the effects of the crisis, albeit marginally. Scotland , Northern Ireland , and Gibraltar voted to remain in the European Union . The Scots' great disappointment stems from the 2014 referendum, where they voted to remain in the United Kingdom or become an independent state. The population voted to remain in the UK, primarily to avoid being excluded from the European Union.

The difficult situation in Gibraltar

In Gibraltar, 95% of voters preferred to remain in Europe, a crucial factor for the local and British economies, given the strategic importance of the continent's only port and freight hub. In the aftermath of the vote, Spanish Foreign Minister García-Margallo (grandson of two generals who led the invasion of Morocco and the annexation of some Moroccan territories to Spain) questioned the territory of Gibraltar as a "Spanish question," which Britain must now address with the Spanish authorities. The proposal was clear: for the minister, Gibraltar should return to Spain within a few years, undergoing a transition period under dual flags.

The announcement sent shivers down the spines of the local population. The governor promptly declared the claims absurd , as the peninsula south of La Línea de la Concepción is English territory, as are its population.

Why was the UK the only one to reject the euro?

A day after the vote, the pound collapsed amid widespread cynicism among other European states and citizens. The United Kingdom was the only country to reject the euro. Why? There are several reasons we can identify.

1. The value of the euro was decided based on the value of the German mark . 1 mark is worth 1 euro. The significantly higher value of the pound dissuaded the British from adopting a lower-value currency.

2. The British economy has almost always been independent from the European one , as the Commonwealth network and the “former colonies” have been more than sufficient over the centuries to develop British economic power and the value of the pound itself.

3. The price of gold is tied to the pound . On international markets, gold can only be purchased with pounds; therefore, anyone who wants to buy gold must first buy pounds. The value of the currency increases passively, and to the extent that the price of gold increases (and it always increases).

The devaluation of the pound appears to us as yet another virtual economy speculation , a sort of "mistrust," a blow delivered by the invisible hand of the financial market to a nation rethinking itself (or to itself), legitimized by the popular vote and national sovereignty. Furthermore, the statements of European leaders are even more perplexing than Brexit itself: while the Brexit signatories envisioned a transition period of a couple of years, the rest of European governments are pushing for a rapid and painless departure, viewing with suspicion and hidden hostility a part of the European family they so celebrated. In Renzi 's statements on Brexit, the Prime Minister states: " The European institutions are convinced that they will guarantee the stability of the financial system and the safety of savers by any means ."

What happens to the Schengen Treaty?

The international political climate is cooling, shortly after the TTIP decisions and amid pressure from the two global superpowers. For EU citizens, therefore, the rules prior to the Schengen Agreement will apply: it will be less easy to set off on an adventure to London and Birmingham expecting to find work there. For those who have already been in England for a few years, however, the problem should be less serious, as the United Kingdom recognizes residency permits or even citizenship after five years of contributions . The issue of the large number of properties purchased by British savers along the Spanish and Italian coasts, accessibility, and length of stay will remain thorny.

Both Europe and Britain accepted the referendum result; it remains to be seen why the Grexit referendum result did not enjoy such popularity and legitimacy.

René Verneau