Insights into Editorial: What Brexit means for the EU and its partners
On January 31, 2020, the United Kingdom left the European Union.
Britain has officially left the European Union (EU) and has become the first country to leave the 28-member bloc.
Nevertheless, we have always respected the sovereign decision of 52% of the British electorate, and we now look forward to starting a new chapter in our relations.
A structured exit:
- This agreement sets out the exact terms of the UK and EU relationship immediately after exit but it is not clear, on what terms the UK and EU’s future relationship will be.
- Under this agreement, the EU and the U.K. agreed on a transition period, until the end of 2020 at least, during which the U.K. will continue to participate in the EU’s Customs Union and in the Single Market, and to apply EU law, even if it is no longer a Member State.
- During this period, the U.K. will also continue to abide by the international agreements of the EU, as we made clear in a note verbale to our international partners.
- A key part of the withdrawal agreement was, there would be a transition period, until the end of 2020.
- The transitional arrangement is designed to make the separation process smoother and it covers subjects like trade, law, and immigration.
- It will give them more time to iron out all the details of their future relationship including a possible free trade deal.
- During the transition, the UK will be officially out of the EU and not be represented on EU bodies but would still have the same obligations as an EU member.
- That includes remaining in the EU customs union and the single market, contributing to the EU’s budget and following EU law.
Element of continuity:
So, with the transition period in place, there is a degree of continuity. This was not easy given the magnitude of the task.
By leaving the Union, the U.K. automatically, mechanically, legally, leaves hundreds of international agreements concluded by or on behalf of the Union, to the benefit of its Member States, on topics as different as trade, aviation, fisheries or civil nuclear cooperation.
They now have to build a new partnership between the EU and the U.K. That work will start in a few weeks as soon as the EU 27 Member States have approved the negotiating mandate proposed by the European Commission, setting out the terms and ambitions for achieving the closest possible partnership with a country which will remain as ally, partner and friend.
Shared and deep links:
The EU and the U.K. are bound by history, by geography, culture, shared values and principles and a strong belief in rules-based multilateralism.
Their future partnership will reflect these links and shared beliefs.
They need to go well beyond trade and keep working together on security and defence, areas where the U.K. has experiences and assets that are best used as part of a common effort.
Collective Responses for transcendental challenges:
- In a world of big challenges and change, of turmoil and transition, the countries must consult each other and cooperate, bilaterally and in key regional and global fora, such as the United Nations, the World Trade Organization, the North Atlantic Treaty Organization or the G20.
- It is perhaps a cliche but the basic truth is that today’s global challenges — from climate change, to cybercrime, terrorism or inequality — require collective responses.
- The more the U.K. is able to work in lockstep with the EU and together with partners around the world, the greater our chances of addressing these challenges effectively.
- At the very core of the EU project is the idea that we are stronger together; that pooling our resources and initiatives is the best way of achieving common goals.
- Brexit does not change this, and will continue to take this project forward as 27.
- Together, the 27 Member States will continue to form a single market of 450 million citizens and more than 20 million businesses.
- Together, 27 Member States remain the largest trading bloc in the world. Together, at 27, we are still the world’s largest development aid donor.
Brexit w.r.t India:
The U.K. is one of the largest investors in India, among the G20 countries. Hence, it is important to see how India and the U.K. can manoeuvre through Brexit and enter into new trade agreements that are mutually beneficial to both economies.
Brexit will directly impact not only the Indian stock market but the global market in totality, including the emerging markets in the world. This is because of the high volatility in the pound.
Both the U.K. and EU account for 23.7% of Rupee’s effective exchange rate. With Brexit, foreign portfolio investments will outflow and will lead to the weakening of the rupee.
India’s businesses based in the U.K. will be hampered as till now they had border-free access to the rest of Europe.
EU partners can be sure that they will stay true to an ambitious, outward-looking agenda — be it on trade and investment, on climate action and digital, on connectivity, on security and counter-terrorism, on human rights and democracy, or on defence and foreign policy.
After Brexit, European Union confidently told that “We will continue to live up to our commitments. We will continue to stand by the agreements that link us to our international partners and we will continue to develop multilateral cooperation frameworks around the world.”
The European Union will continue to be a partner you can trust. A steadfast defender of rules-based multilateralism, working with our partners to make the world more secure and fair.