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Many people have seen the term ‘Brexit’ and wondered “What is Brexit”? It is a compound word that includes “Britain” and “Exit.” It refers to a voting referendum held in June, 2016 in the United Kingdom which asked UK voters if they wanted to leave the European Union (EU).
Prior to the vote, many polls and experts had predicted voters would choose to stay in the EU rather than “Brexit.” The final vote tally was 17.4 million votes for “leave,” or nearly 52% of voters choosing to “Brexit.”
Investopedia reported that there were stark differences in regional voting; for example, only 38% of Scottish voters wanted to leave the EU, while more than 53% of English voters chose to leave.
History and Reasons for Vote
The European Community, now called the European Union [EU] was established in 1967, following the Treaty of Rome, which was signed by 6 founding EU states. Britain joined the European Union in 1973, along with Denmark and Ireland. An earlier referendum on British membership in the EU was held in 1975, with 66% of UK voters favoring continued membership in the European Union. In 2002, the EU introduced the common currency used across most member countries, the Euro. As of 2017, there were 28 member states of the EU. In order to join, member states must meet criteria for a democratic, free market government, called the Copenhagen criteria. Prior to Brexit in June, 2016, no member state had withdrawn from the EU.
How Will the UK Leave the EU?
The Brexit referendum in June, 2016 did not mean that the United Kingdom would immediately leave the EU. Prime Minister David Cameron had promised a vote on EU membership for four years; when the vote was held, he was forced to resign. Theresa May became the leader of UK’s Conservative Party and Prime Minister. She invoked Article 50 of the Lisbon Treaty which governs membership in the EU. With no precedent for leaving the EU, this began a two-year negotiation process. A negotiated, individual treaty will be completed during this time governing the UK’s relationship with EU nations.
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Economic Impact of Brexit
Dozens of negative and positive economic impacts of Brexit were proposed by “leave” and “stay” supporters. “Leave” voters were motivated by an ongoing European debt crisis, as well as fears over British self-government and immigration. The UK’s financial markets experienced short-term financial effects, including a one-day crash of the British pound against the U.S. dollar. The Euro also fell in value in relation to the dollar.
Other Exit Movements
A poll conducted in July 2016 showed that several other European nations had significant numbers of citizens who would vote to leave or “exit” the EU. Italy and France topped the list of members whose residents wanted an exit referendum similar to Brexit.
Simply adding “exit” to the first two letters of a country’s name doesn’t always work. While “Grexit” has been used to signify Greece’s leaving the EU, Italy’s exit movement is referred to as “Italeave.”
What does Brexit mean? It is one part of a movement of many different European nations to move away from shared currency and government which has been provided by the European Union over the past 50 years.
