Euroskeptic euphoria at exit result
Print Edition
BRITAIN has voted to leave the European Union, forcing the resignation of Prime Minister David Cameron and dealing the biggest blow to the European project of greater unity since World War II.
Global financial markets plunged yesterday as results from a referendum showed a 52-48 percent victory for the campaign to leave a bloc Britain joined more than 40 years ago.
The pound fell as much as 10 percent against the dollar to touch levels last seen in 1985, on fears the decision could hit investment in the world’s fifth-largest economy, threaten London’s role as a global financial capital and usher in months of political uncertainty. The euro slid 3 percent.
World stocks saw more than US$2 trillion wiped off their value, with indexes across Europe heading for their sharpest one-day drops. Britain’s big banks took a US$100 billion battering, with Lloyds, Barclays and RBS plunging as much as 30 percent at one point.
The UK itself could now break apart, with the first minister of Scotland — where nearly two-thirds of voters wanted to stay in the EU — saying a new referendum on independence was “highly likely.”
An emotional Cameron, who led the “Remain” campaign to defeat, losing the gamble he took when he called the referendum three years ago, said he would leave office by October.
“The British people have made the very clear decision to take a different path and as such I think the country requires fresh leadership to take it in this direction,” he said in a televised address outside his residence.
“I do not think it would be right for me to be the captain that steers our country to its next destination,” he added, holding back tears before walking back through 10 Downing Street’s black door with his arm around his wife Samantha.
Quitting the EU could cost Britain access to the EU’s trade barrier-free single market and means it must seek new trade accords with countries around the world. A poll of economists by Reuters predicted Britain was likelier than not to fall into recession in the coming year.
The EU for its part will be economically and politically damaged, facing the departure of a member with its biggest financial center, a UN Security Council veto, a powerful army and nuclear weapons.
In one go, the bloc will lose around a sixth of its economic output.
“It’s an explosive shock. At stake is the break-up pure and simple of the union,” French Prime Minister Manuel Valls said. “Now is the time to invent another Europe.”
The vote will initiate at least two years of divorce proceedings with the EU, the first exit by any member state.
Cameron — who has been premier for six years and called the referendum in a bid to head off pressure from domestic euroskeptics — said it would be up to his successor to formally start the exit process.
His Conservative Party rival Boris Johnson, the former London mayor who became the most recognizable face of the Leave camp, is widely tipped to seek his job.
Johnson spoke to reporters at “Leave” campaign headquarters but took no questions on his personal ambitions.
“We can find our voice in the world again, a voice that is commensurate with the fifth-biggest economy on Earth,” he said.
Lawmakers from the opposition Labour Party also launched a no-confidence motion to topple their leader, leftist Jeremy Corbyn, accused by opponents in the party of campaigning only tepidly for its "Remain” stance.
There was euphoria among Britain’s euroskeptic forces, claiming a victory over the political establishment, big business and foreign leaders, including US President Barack Obama who had urged Britain to stay in.
“Let June 23 go down in our history as our independence day,” said Nigel Farage, leader of the UK Independence Party, as he described the EU as “doomed” and “dying.”
On the continent, politicians reacted with dismay.
“It looks like a sad day for Europe and Britain,” said German Foreign Minister Frank-Walter Steinmeier. His boss Angela Merkel invited the French and Italian leaders to Berlin to discuss future steps.
The shock hits a European bloc already reeling from a eurozone debt crisis, unprecedented mass migration and confrontation with Russia over Ukraine. Anti-immigrant and anti-EU parties have been surging across the continent, loosening the grip of the establishment that has governed Europe for generations.
President Barack Obama said the United States’ relationship with both the United Kingdom and the European Union would endure in the wake of Britain’s decision to leave the EU.
“The people of the United Kingdom have spoken, and we respect their decision,” Obama said in a statement. “The United Kingdom and the European Union will remain indispensable partners of the United States even as they begin negotiating their ongoing relationship.”
Britain has always been ambivalent about its relations with the rest of post-war Europe.
Cameron’s ruling Conservatives, in particular, have harbored a vocal anti-EU wing for generations, and it was partly to silence such figures that he called the referendum in 2013.
Back then it looked like a sure thing. But the decision of Johnson to come down on the side of “Leave” gave the exit campaign a credible voice.
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