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World in a Shock as UK decides to BrEXIT

The highly debated topic over last several months has come to a closure. The country Britain, has finally voted to leave the European Union, forcing the resignation of Prime Minister David Cameron and giving the biggest blow since World War 2 to the European project of forging greater unity.

The result has not been as predicted by a lot of experts and countrymen and therefore the markets plummeted big time.

HISTORICAL PERSPECTIVE

Just to give a historical background, the Britain joined EU in 1973 when PM Edward Heath took Britain in. But this is not the first time Britain opted out of its bloc. In 2002, when EURO was introduced, even at that time British public opinion did not appear to support the Euro & its life was drawn to an end.

BASIS FOR BREXIT

Pro-Brexit voters were persuaded by the argument that leaving the EU meant taking back control of immigration — by abandoning the bloc’s principle of free movement among member states — and reclaiming billions that the U.K. pays to Brussels each year.

There were 52% who voted in favor of the exit.

IMPACT: CURRENCY FALL

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. It also threatened London’s role as a global financial capital and usher in months of political uncertainty. The euro slid 3 percent.

Brexit
Brexit

Conservative former London Mayor Boris Johnson said “the British people have spoken up for democracy in Britain and across Europe,” while Nigel Farage, leader of the hard-right U.K. Independence Party, said “the dawn is breaking on an independent United Kingdom.”

AFTERMATH

The decision launches a yearslong process to renegotiate trade, business and political links between the U.K. and what will now be a 27-nation bloc.

Cameron, who had led the campaign to keep Britain in the EU, said he would resign by October and left it to his successor to decide when to invoke Article 50, which triggers a departure from European Union.

Sources: FirstPost, Indian Express

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