What Is Brexit?
Let me explain Brexit directly to you: it's a term combining 'British' and 'exit' that captures the UK's choice to leave the European Union after a referendum on June 23, 2016. The actual departure happened at 11 p.m. GMT on January 31, 2020. By December 24, 2020, the UK and EU agreed on a provisional free-trade deal that avoids tariffs and quotas on goods, but uncertainties remain, especially for services which form 80% of the UK's economy. This deal prevented a no-deal scenario that would have hit the UK economy hard. Parliament approved it on January 1, 2021, and the European Parliament followed on April 28, 2021. Known as the Trade and Cooperation Agreement, it allows tariff-free goods trade but requires customs checks, making trade less seamless than before.
The Referendum
You need to know the referendum details: the Leave side won with 51.9% or 17.4 million votes, against Remain's 48.1% or 16.1 million, with a 72.2% turnout. Results varied regionally—53.4% of English voters backed Brexit, but only 38% in Scotland. England's population dominance tipped the scales. If limited to Wales, Scotland, and Northern Ireland, Brexit would have gotten under 45%. The outcome shocked markets, dropping the pound to a 30-year low against the dollar. Prime Minister David Cameron, who pushed for Remain, resigned, and Theresa May took over in July 2016.
The Article 50 Negotiating Period
Here's how the process started: on March 29, 2017, May invoked Article 50 of the Lisbon Treaty, giving two years to negotiate. A snap election on June 8, 2017, cost Conservatives their majority, leading to a deal with the Democratic Unionist Party. Talks began June 19, 2017, with no prior Article 50 precedent except Algeria in 1962 and Greenland in 1985. By November 25, 2018, a 599-page Withdrawal Agreement covered citizens' rights, the divorce bill, and the Irish border, but Parliament rejected it 432-202 on January 15, 2019. May resigned as leader on June 7, 2019, after three failures. Boris Johnson became prime minister in July, vowing to leave by October 'do or die,' even without a deal. A new deal on October 17 replaced the Irish backstop. Johnson's August 2019 Parliament suspension was ruled unlawful by the Supreme Court. Party crises hit both Conservatives and Labour. The UK sought an extension past October 31, 2019, and Johnson won a December 12 election with 365 seats.
Brexit Negotiations
Let me break down the negotiations for you: David Davis led for the UK until resigning in July 2018, replaced by Dominic Raab, then Stephen Barclay. Michel Barnier handled the EU side. The UK wanted simultaneous withdrawal and future talks, but the EU insisted on sequenced progress. Citizens' rights allowed free movement until transition's end, with residency upgrades required. EU migration to the UK fell to 2009 levels. The government debated EU citizens' rights, with the Supreme Court requiring parliamentary approval. The financial settlement was estimated at £32.8 billion, covering transition contributions and assets. The Northern Irish border protocol created a limited customs border in the Irish Sea, replacing the backstop that stalled May's deal.
Arguments for and Against
You should consider the arguments: Leave supporters cited the European debt crisis, immigration, terrorism, and EU bureaucracy dragging the UK economy, plus sovereignty concerns—the UK skipped the euro and Schengen. Opponents highlighted risks to exports and benefits of EU freedoms for goods, services, capital, and people. Both sides saw short-term economic instability and long-term poverty risks. Cabinet shake-ups followed, with Johnson and Davis resigning over May's soft Brexit plans. Treasury projections showed GDP drops under various scenarios, dismissed by Leave as 'Project Fear.' Vote Leave claimed £350 million weekly savings for NHS, later disavowed.
Brexit Economic Response
Directly addressing the economy: GDP growth slowed to 1.4% in 2018 from 1.9% in 2016, with forecasts adjusted post-COVID. Unemployment hit a 44-year low at 3.9% in early 2019, but inflation spiked to 3.1% in late 2017, later soaring to 8.7% by April 2023. Trade was expected to drop 22% under a free trade agreement, with minimal offsets from other pacts.
June 2017 General Election
The election matters because: May called a snap vote on June 8, 2017, but Conservatives lost their majority, winning 318 seats to Labour's 262, leading to a DUP coalition. This weakened her Brexit mandate and softened positions, though it raised no-deal risks.
Scotland Referendum
Scotland's angle is key: no Scottish area voted Leave, with 62% overall for Remain. Calls for independence grew, but the SNP lost seats in 2017, resetting plans. The 2014 referendum saw 44.7% for independence; post-Brexit, Sturgeon pushed for another but faced economic hurdles like oil revenue shortfalls.
Upsides for Some
Some benefits exist: a weak pound aided exporters in precious metals, vehicles, and aircraft. Tourism, energy, and services gained. India saw potential trade advantages post-Brexit.
U.K.-EU Trade After Brexit
Post-Brexit trade: May pushed a hard Brexit, leaving single market and customs union, but the white paper proposed a goods free trade area. Options included EEA like Norway, Swiss bilateral pacts, CETA-style, or WTO terms, each with drawbacks like lost influence or tariffs.
Impact on the U.S.
For the US: investments in the UK totaled $129.3 billion in 2021 output; Brexit jeopardizes affiliate earnings and exposes credit risks in European banks.
Who’s Next to Leave the EU?
Others might follow: Euroskeptic movements in Italy and France pushed referendums, though leaders like Salvini and Le Pen faced setbacks.
The Bottom Line
In summary, the EU started in 1993 with 12 members, growing to 28 before Brexit left 27; the UK's exit stemmed from nationalism and economic concerns, requiring lengthy negotiations and a transition before finalizing in 2020.
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