It is undeniable that the news of Britain voted to leave European Union has shook the world greatly. The UK’s withdrawal or widely known as Brexit would definitely have an impact on the world economy, particularly to the businesses in UK which is claimed to be the main concern after all. Over 99% of the businesses are Small or Medium Sized businesses (SME’s) which is equivalent to 5.4 million businesses in total (House of Commons Library, 2016). Of course, these businesses will be affected, both directly and indirectly. This essay will discuss mainly on the opportunities and risks that these businesses will face as a result of Brexit.
As the world already knows, ‘Single Market’ is greatly known for European Union’s biggest achievement and …show more content…
Despite of that, it is always argued that Brexit would not make the UK government subsidise in agriculture, or even match the current level of subsidy under CAP (Emily Gosden and Marion Dakers, 2016). Nevertheless, even if the case of subsidies being cut down, there is always opportunity that Brexit will bring in to the farmers, but left unknown. For example, the UK government might think of better ways to support the farmers or better yet introduce an improved scheme. The latter, without doubt will provide even better and higher support to the farmers. In conclusion, farmers might lose but Brexit can possibly offer an opportunity to the whole system.
On top of that, the biggest export market for UK is claimed to be Europe (Anon, 2016). Hence, making a decision to leave the European Union will only affect the UK economy even further, particularly to the small businesses in UK. Additionally, the weaker pound will only put the small businesses under high risk. This statement is further reflected from one of the most world known engineering-based company, ’the Group’ as its executive chairman once said that their revenue was broadly flat as a result of Brexit and the orders remain weak and patchy as well (Andy Bounds and Chris Tighe, 2016). This is indeed associated with the absence
With reference to organisations or industries that you know, to what extent do you think that recent changes in the UK economy will have inevitably damaged the long-term profits of businesses that operate in this country? (40 marks)
The UK economy is constantly changing for various reasons such as improvement in medicine and increased globalisation leading to people living longer and the UK economy becoming more diverse culturally. Whether or not it provides an opportunity or a threat to a business will largely depend upon how the management of the business decides to attempt to change because of the change of the demographics.
In order to understand the evolvement of the Single Market of the European Union, one has to take the general background into consideration. Therefore, it is important to have a look at the Treaty on European Union (Maastricht Treaty) which gave birth to the creation of the Single Market. Having been the Common Market before the Maastricht treaty, the European Economic Community (EEC) Treaty already clarified the objective of cooperation between member states. Throughout the Single Market, those objectives should be transformed into reality.
The European Union (EU) is a unique economic and political partnership between 28 different countries. It consists of about half a billion citizens, and its combined economy represents about 20 percent of the world’s total economy (Briney, 2015). Today The European Union works as a single market, with free movement of people, goods and services from one country to another. There is a standard system of laws to be followed, and since 1999 many countries share a single currency called the Euro (Europa.eu, 2015). This essay will explore the background history of the European Union and the benefits and drawbacks of the European Union.
Since 1950 European Union (EU) was created it has promoted peace, prosperity and values among the member nations and its neighbouring countries. EU’s influential tools, has helped transform many European states into functioning democracies and prosperous countries. EU’s membership has grown from 6 to 28 countries (Enlargement, 2014), satisfying a historic vow to integrate the continent bringing in most states of Central and Eastern Europe (CEE) by peaceful ideals.EU has anticipated the enlargement as an extraordinary opportunity to endorse political strength and economic success in Europe. EU’s extension policy is open to any European state that fulfils the EU’s political and financial criteria for membership; still the political process of inclusion of new state requires a unanimous agreement from all the existing 28 member states. Europe is considered to be more flourishing and safer place due to the promotion of democracy, anti-corruption policy and the single market policy.
Although the British voted for leaving European Union, Brexit would adversely affect the British economy in the fields of trading and foreign direct investment.
The European Union’s economy, despite being one of the largest in the world; very comparable to the size of the economy of the United States, does not provide a great benefit to the UK. Both the economies of the UK and of the EU are less than ideal for the respective nations, but
Brexit is not a just a political debacle, but also a great financial issue. The author points out that it is considered to be a bigger concern than Scotland’s independence. Bankers and other financial sectors feel that Brexit can cause a huge deal of loss, because Britain is said to be the gateway for the rest of the 28 nation European Union, a market which holds about 500 million more than what is prevalent in the United States and Japan combined. Anderson feels that for most big businesses like Goldman Sachs or Citigroup, London is the financial capital, which provides a gateway for nearly all of Europe. Without the unregulated access, the free flow of capital, resources, talent and goods and services would have to be renegotiated, making it difficult for the European nations. The financial industry is said to be the most affected since it accounts for about 7 percent of Britain’s gross
With Britain’s vote to no longer remain the EU, its economy could take a dangerous hit and weaken considerably. Emma Charlton and John Robison, journalists for Businessweek, claim that “voting to leave the European Union would dramatically increase the UK’s chances of” (Charlton and Robinson) recession because of the risk that it places on the economy. Their prediction points out how much of a threat leaving is to Britain because of the consequences that it will bring to jobs, growth, and investment. Lukanyo Mnyanda and Lucy Meakin, journalists of Businessweek, point out how parts of Britain’s economy have already been hurt by the decision, with the "[pound] sterling earlier [reaching] $1.3229, the lowest since 1985...[weakening] 6.2 percent to 81.27 pence per euro, for the biggest decline on record" (Mnyanda and Meakin). This decrease in the value of the pound is dangerous because a weaker pound will make UK imports, like clothes and diesel, become more expensive because they require a larger value of pound in order to be
The Government in the UK is relatively stable. We currently have a coalition government as none of the political parties got enough votes to win the majority. Therefore, both of the parties’ manifestos are co-joined so there is a lot more UK businesses need to prepare for. Political decisions can affect businesses
There are several ways the United Kingdom (UK) could exit the European Union (EU). Differences between a Soft and a Hard Brexit are considerable and each prospect deserves thorough investigation in order to understand how it will affect British businesses. The evolution of the EU allowed years of institutional and political transformation through the creation of the European Single Market which benefited British businesses (Medrano, 2003). However, the UK has always been reluctant to European obligations and stood out rapidly from the rest of the members by keeping their own currency. Following the Article 50, outlining the right to quit the EU, the UK citizens decided to leave in June 2016. This result caused important concerns and uncertainty especially for British businesses. In 2017 negotiations between the UK and the EU will start, however the way it will happen is still very ambiguous. British firms will be able to lobby for their favourable outcome, as they are in a position of power and could possibly influence the government in their negotiations. As firms have a strong impact on decision-makers, it is important to clarify for which outcome they should opt to protect in the best way their stakeholders during and after the transition of UK.
Early this year the United Kingdom held a referendum to decide whether to leave or stay apart of the European Union. This event is called the “Brexit” (Britain exiting the European Union), but even though the acronym only includes Britain it means the entirety of the United Kingdom. In the referendum, most of England and Whales voted to leave while Northern Ireland and Scotland voted to stay. Ultimately the United Kingdom’s vote was won in favor of leaving the EU with a 51.9% vote to stay and a 48.1% vote to leave (BBC News). Now the question is what does this mean for the UK and how will this impact its economy in the future? It may be too early to tell how this will play out, but for us to identify what is happening now we must thoroughly and truly understand the reasons for this Brexit in the first place.
After the United Kingdom’s (UK) decision to leave the European Union (EU) there has been numerous questions and uncertainty of how this will impact the British economy and its trade market. By enlarge the majority of large businesses argue that it will have a negative impact and consequently have backed out of protentional new investments in the UK because of this uncertainty. An example of this is Lloyd’s of London who have axed plans for a new sharing worth potentially 9 billion pounds due to post- Brexit instability. This may also be the case for many large businesses until the leave is complete and the economy is once again stable. However, it can also be argued that Brexit may very well lead to new trade opportunities outside of
It is precise that we begin by explaining the meaning of the term “Brexit”; it is a portmanteau of the words “Britain” and “Exit”, which was just one of the terms for the results of the 2016 referendum, the other one was “Bremain” (Britain and remain) which was a lot less promoted and controversial. For the 2016 referendum, 52% of the votes went for Britain leaving the European Union, in a poll with 72% of participation, a total of 33.577.342 votes, 17.410.742 for Brexit and 16.577.342 for Britain staying in the European Union (BBC World, 2016). England voted for Brexit, by 53.4% to 46.6%, as did Wales, with Leave getting 52.5% of the vote and Remain 47.5%. Scotland and Northern Ireland both backed staying in the EU. Scotland backed Remain by 62% to 38%, while 55.8% in Northern Ireland voted Remain and 44.2% Leave (Hunt and Wheeler, 2016).
With the effect of the Single European Act on 1st July 1987, the emergence of European Union (EU) as a common market has essentially been created. The benefits of this act are substantial to European firms, economies, and workers. It eliminates conflicting national regulations and trade barriers, as well as offering firms opportunity to sell their goods to all other EU members (Griffin & Pustay 2005).