Another Day, Another Resignation
The political situation in the United Kingdom has certainly been dramatic these past few months. Since this summer’s disastrous Chequers meeting, which led to the resignations of Foreign Secretary Boris Johnson and Brexit Secretary David Davis, Prime Minister May has been under constant attack from her own party who view her Brexit plan as weak and short sighted.
Last weekend, European leaders gathered in Brussels to vote on May’s Brexit plan. Although European Commission President Jean Claude-Juncker called Brexit “a tragedy” May’s plan was approved by the European Union’s leadership. The turmoil however is still evolving across the channel. On November 30th, Sam Gyimah, the UK’s Science and Universities Minister resigned, further damaging May’s crumbling cabinet. Gyimah resigned due to May’s decision to pull the UK out of the highly renowned Galileo project, which aimed to create a European version of the United State’s GPS system. May stated that the United Kingdom needs its own version of Galileo for national security interests, although the UK had already invested 1.4 billion pounds into the project.
Gyimah is the 10th minister who has resigned from May’s government due to Brexit. Resignations represent a clear lack of confidence in the Prime Minister’s ability to lead the government, thereby reducing the Prime Minister’s power. May is currently touring rural England to gather support for her Brexit Plan. The criticism she is facing however is only growing in intensity. Eurosceptics within the UK’s government have become increasingly vocal about their disdain for May’s leadership. On the other side of the bench, labour leader, Jeremy Corbyn strongly opposed May’s plan saying her government was the most “shambolick in in living memory”. Corbyn then announced that the Labour party would create an alternative to the Conservative’s Brexit Plan.
In terms of economic outlook, the future scenarios for the UK are quite grim. The government reported that a “no-deal” scenario would lead to an 9.3% contraction in the United Kingdom’s economy. In comparison, the economic crisis of 2008 caused a 4.2% contraction in the United Kingdom’s economy. Multinational corporations have clearly stated how Brexit will impact business in the UK. Banking operations are slowly moving into Europe as immigration restrictions will prevent London based banks from acquiring international talent. Since Brexit, the pound has reduced by 3% against the US dollar and 2.74% against the Euro, pushing down London real estate prices. According to Reuters and LonRes, a property data company, London experienced a 25% reduction of houses valuing £2m or more on the London market in the third quarter of 2018 compared to last year.
With a deadline for Brexit in March, which is only a few months away, the United Kingdom must resolve its internal politics before it clashes with the European Union once again. If skepticism of May’s government continues to grow and a vote of no confidence is called, Brexit’s entire economic, political, and social consequences will be felt in the United Kingdom.
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