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Anti-Brexit campaigner and many European leaders had warned Britain of huge economic loss after it quits EU. But the other side of the coin is that even European Union will lose on multiple fronts due to Brexit.
EU would not just be losing a vital component, but also one of its richest countries, with its biggest defense budget and its most successful financial-services hub.
In the backdrop of Russian aggression and political turmoil from all sides, including from within, EU would be in bad spot without Britain. On Sunday Finland urged Europe to increase NATO contributions and focus more on security.
Britain alongwith France has participated in many EU military operations, particularly in Africa where the EU has run several peace-keeping and training missions. Although the British government has said cooperation will continue in some form, but the EU is mindful that it’s losing expertise and clout.
Once UK departs from the bloc, the 27 nations left behind need to double down on the bloc’s founding principle to ensure security for its remaining 444 million citizens. Brussels will have to demonstrate to European citizens that it is capable of taking care of their security. This would be a huge message for wary European countries along the Russian borders.
The bloc is under threat in the east by Russia and in the west by Trump administration that has predicted its disintegration. Also European Union is facing an unprecedented level of populist swell that threatens to undo many of the bloc’s founding principles. Geert Wilders of the Netherlands and Marine Le Pen of France have upended the politics of their countries. They have succeeded to an extent in cashing in on anti-immigrant and Islamophobic sentiment among a section of European population. Though it is their political posturing, it can be harmful for Europe.
Europe has maintained and lived in peace for decades. But the string of terror attacks, populist surge and guileful politicians have frayed the political, social and economic fabric of Europe. EU must give a serious approach to the security risks it faces. Terrorist attacks in Paris, Brussels and Berlin underscore the need for safeguards.
In this context, Trump administration’s demand that European members
of the North Atlantic Treaty Organization foot their share of the security bill is
understandable.
Given the present global scenario, Brexit would rob Europe a louder voice on world stage as UK and France are the only two European countries that are permanent members of the United Nations Security Council.
Free movement of EU citizens to live and work in the bloc’s member countries was one of EU’s cherished principles. Liberal labor laws, English language and robust economy turned Britain into a magnet for Europeans seeking to take advantage of the EU’s free-movement rules. And so, Brexit removes the opportunities for European citizens to move unhindered to one of their favourite countries. Also, UK accounts for accounts for 37 percent of all global foreign-exchange trading, 39 percent of the world’s trading in over-the-counter derivatives and is the biggest center for international bank lending. Now EU will have tough time to retain services for the rest of Europe after Brexit.
Further, after UK quits, the EU will lose 12 billion euros ($13 billion) a year. It will adversely affect the countries which joined the EU most recently. EU will have to work out how to make up the shortfall.
It will be the interest of both EU and UK to maintain a close economic
relationship.