The United Kingdom voted to leave the European Union in the long-awaited ‘Brexit’ referendum held on Thursday, June 23. The historic and unprecedented decision has shocked some European countries and will have a great significance for the UK, the European Union, as well as the wider global economy.
British people had to answer a simple question at the referendum – ‘Should the United Kingdom remain a member of the European Union or leave the European Union?’ – and it seems that the majority of the voters opted for the second option.
In a surprising outcome, leave won by 52% to 48%, although the polls and the betting markets had pointed towards remain. The result still has to be ratified by parliament.
The referendum turnout was 71.8%, which means that over 30 million people expressed their opinion through vote. It was the highest turnout at a UK election since 1992.
For those interested in the breakdown of the votes across Britain, England had a clear inclination towards leaving, by 53.4% to 46.6%, as did Wales, with Leave getting 52.5% and Remain 47.5%, while Scotland and Northern Ireland voted mostly for staying in the EU (62% Remain to 38% Leave and 55.8% Remain to 44.2% Leave, respectively).
The first effects of the decision to quit have quickly started to show up. The sterling pound, for instance, dropped to a more than 30-year low of $1.3230. Additionally, the European Central Bank reports that European stocks have spiraled down after the results were announced, with investors turning their attention towards safer assets.
Some of the biggest banks on the continent were hit hard, as shares in Royal Bank of Scotland, Lloyds and Barclays, plummeted as much as 30 percent, but rebounded slightly afterwards.
On the political front, David Cameron has announced his resignation this morning after Brexit vote, saying that ‘The country requires fresh leadership to take it in that direction.’
So what happens now? The Article 50 of the Lisbon Treaty will have to be activated, and then the United Kingdom will begin the negotiation process for a new trade relationship with the EU. The estimated period to leave the Union is two years.