An Assessment of the Socio-Political and Economic Impact of the

United Kingdom’s Exit from the European Union (BREXIT)

By

Christopher P Murasi

(R144173K)

A DISSERTATION SUBMITTED IN PARTIAL FULFILMENT OF THE

REQUIREMENTS OF THE BARCHELOR OF SCIENCE HONOURS IN POLITICAL
SCIENCE DEGREE

DEPARTMENT OF POLITICAL AND ADMINISTRATIVE STUDIES

FACULTY OF SOCIAL STUDIES

UNIVERSITY OF ZIMBABWE

April 2017

i
Dedication
This dissertation is dedicated to my Mother Dorcas Padhuze who in her unwavering love and
support helped me attain and achieve my dreams without any condemnation and judgement. I
also dedicate it to my family who have always been a beacon of hope to me. Lastly I dedicate
this piece of academic work to Nyasha Chikosha, a friend who will forever be cherished.

ii
Acknowledgements
I would like to extend my sincerest form of gratitude to all the people and organisations who in
their cooperation, have enabled me to compile and consolidate this comprehensive study. Special
thanks goes to my lecturers and tutors: Mr Lawrence Mhandara, Mr Chunnies Kusena, Mr
Murwira, Mrs Eve Mazando, Mr Kuda Paraffin and all the members of staff at the University of
Zimbabwe especially the Department of Political and Administrative Studies. My gratitude also
extends to my supervisor Dr Chimanikire for his patience, Professor Rungano Zvogbo for his
moral support and the embassies of Britain and the European Union for their cooperation. I
would also like to thank those who participated in the research for their informative opinions.
And lastly I give thanks to the almighty God through whom all this was made possible.

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Abstract
This study seeks to make a determination of the socio-political and economic results of the
United Kingdom’s decision to leave the European Union. This phenomenon is commonly known
as BREXIT. This study is more of a forecast of what is to become of the socio-political and
economic environment of the UK and elaborating on the implications that are immediate. This
study employed a qualitative approach in research making use of key informant interviews, focus
group discussions and documentary search. The BREXIT phenomenon has caused a seismic shift
in the political and economic status quo in the United Kingdom. This can be corroborated by the
literature that explains Integration, Euroscepticism, Supranationalism vs Intergovernmentalism
and the concept of Secession. Theories that back up this research include Liberalism and
Realism. Findings in this comprehensive study illustrate that BREXIT has had a profound effect
on the economic, social and political strata of the United Kingdom. This illustrated through
aspects such as financial services, trade, foreign investment and agriculture. Immigration,
politics in Westminster, Secession of Scotland and the EU/UK relations are articulated in relation
to the aftermath of BREXIT. Conclusions are that BREXIT brings about a lot of changes in the
economic, political and international spectrum. Recommendations would entail the UK
negotiating a good BREXIT deal which will guarantee economic and social stability. Moreover
address the political quagmire in Westminster

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Table of Contents

Contents
Dedication...................................................................................................................................................ii
Acknowledgements....................................................................................................................................iii
Abstract......................................................................................................................................................iv
Table of Contents........................................................................................................................................v
List of Figures...........................................................................................................................................vii
List of Acronyms.........................................................................................................................................1
CHAPTER ONE..........................................................................................................................................2
1.0 INTRODUCTION.......................................................................................................................2
1.1 BACKGROUND OF THE STUDY..................................................................................................3
1.2 STATEMENT OF THE PROBLEM.................................................................................................3
1.3 OBJECTIVES OF THE STUDY.......................................................................................................4
1.4 RESEARCH QUESTIONS...............................................................................................................4
1.5 JUSTIFICATION OF THE STUDY.................................................................................................4
1.6 METHODOLOGY............................................................................................................................5
1.6.1 Key Informant Interviews...........................................................................................................5
1.6.2 Documentary Search...................................................................................................................5
1.6.3 Focus Group Discussions............................................................................................................5
1.7 LIMITATIONS OF THE STUDY.....................................................................................................5
1.8 DELIMITATIONS............................................................................................................................6
1.8 SUMMARY......................................................................................................................................6
CHAPTER TWO.........................................................................................................................................7
2.0 INTRODUCTION.............................................................................................................................7
2.1 CONCEPTUAL FRAMEWORK......................................................................................................7
2.1.1 Integration...................................................................................................................................7
2.1.2 Euroscepticism............................................................................................................................8
2.1.3 Supranationalism vs Intergovernmentalism................................................................................9
2.1.4 Secession....................................................................................................................................9
2.2 THEORETICAL FRAMEWORK...................................................................................................10
2.2.1 Realism.....................................................................................................................................10
2.2.2 Liberalism.................................................................................................................................11
2.3 CONCLUSION...............................................................................................................................12
CHAPTER THREE...................................................................................................................................13

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3.1 INTRODUCTION...........................................................................................................................13
3.2 METHODOLOGY..........................................................................................................................13
3.2.1 Data Collection Methods..........................................................................................................13
3.3 RESEARCH EXPERIENCE...........................................................................................................13
3.4 RESPONSE RATE..........................................................................................................................13
3.5 THE MAJOR OBJECTIVE OF THE STUDY WAS TO ASSESS THE SOCIO-POLITICAL AND
ECONOMIC IMPACT OF THE UNITED KINGDOM’S EXIT FROM THE EU (BREXIT)..............14
3.5.1 Economic Impact of Brexit in the UK......................................................................................14
3.5.2 Socio-Political Impacts of Brexit in the UK..............................................................................17
3.5.3 UK/EU RELATIONS...............................................................................................................22
3.5.4 CONCLUSION............................................................................................................................23
CHAPTER FOUR.....................................................................................................................................24
4.1 INTRODUCTION...........................................................................................................................24
4.2 CONCLUSIONS.............................................................................................................................24
4.3 RECOMMENDATIONS.................................................................................................................25
4.4 CONCLUSION...............................................................................................................................27
BIBLIOGRAPHY.....................................................................................................................................28

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List of Figures

Figure 1 Stock of FDI in the UK from 2005 to 2013 (Taken from the Woodford
Economic Report)....................................................................................................16
Figure 2: Graph Illustrating the FDI inflows into the UK (Taken from the
Woodford Economic Report 2016).........................................................................16
Figure 3 Scottish Nationals demonstrating in Glasgow for Independence (Taken
from the New York Times March 17 2017)............................................................19
Figure 4 Migration in the UK (Taken from the Woodford Economic Report).......20

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viii
List of Acronyms
AU African Union

BBC British Broadcasting Cooperation

BRICS Brazil, Russia, India, China, South Africa

BREXIT British Leaving the European Union

CAP Common Agricultural Policy

COMESA Common Market for Eastern and Southern Africa

CNN Cable News Network

ECJ European Court of Justice

EEA European Economic Area

EFTA European Free Trade Association

FDI Foreign Direct Investment

FTA Free Trade Agreement/Area

FM First Minister

LD Liberal Democrats

PM Prime Minister

UK United Kingdom

UKIP United Kingdom Independent Party

UN United Nations

WTO World Trade Organization

1
CHAPTER ONE
INTRODUCTION

1.0 INTRODUCTION
The modern European Union is a culmination of determinative efforts by European Statesmen to
prevent future pernicious conflicts in the continent after World War II. The drive behind this was
an agenda to bind nations together by forging closer economic and industrial cooperation.
Rosamond (2002; 498) articulates that the European Union is the most developed project of
Regional integration in the world. Each nation complementing the other in one intrinsic coherent
and effective system of collaboration to facilitate mutual sustainable development. Taking into
consideration that such a system had to take decades to establish and consolidate, when member
states make resolutions to leave such a union that in itself should be a cause for concern
especially for member states considered to be key stakeholders in such unions. Recently the
United Kingdom had a referendum to determine whether to remain in the European Union or to
leave the Union. 51.9 % of the United Kingdom’s population voted to leave and the United
Kingdom’s government has started the process of revoking its membership from the union. This
comprehensive study seeks to assess the socio political and economic impact of the move to
leave the Union also looking into the dynamics of why it has opted for this seismic shift in
alternative that has rattled the fabrics of the international system.

Structure of the Study

The study contains four chapters each dealing with a specific cluster in the research. The first
chapter that is the preliminary chapter introduces the reader to the topic of study, articulating the
background of the study, statement of the problem, objectives of the study, research questions,
justification of the study, methodology of research as well as limitations and delimitations of the
research. Chapter two will outline the literature review of the subject in question, looking into
the conceptual and theoretical framework associated with the European Union and the
relationship it has with the United Kingdom. Chapter three deals with the data presentation and

2
analysis. The fourth and final chapter will articulate the conclusions and the recommendations in
line with the study.

1.1 BACKGROUND OF THE STUDY

Britain first attempted to join the European Union through the Common Market in 1963.
However their endeavour was thwarted by the veto of President Charles de Gaulle who feared
that it would have been a ‘Trojan Horse’ tactic to let America interfere in European Affairs
(Jones,2007;15) . It finally joined the union in 1973 and within a year calling for reforms in the
Common Agricultural Policies. In 1975 the UK held a referendum to decide to continue the
membership in which 67% voted yes. The next four decades have been characterized with highs
and lows in the relationship.23 June 2016 marked the beginning of the end of the United
Kingdom’s intimate relationship with the EU after 51.9 percent of the 72 percent that
participated voted to leave the Union in a referendum that would determine the UK’s continued
membership. The vote for Brexit followed a campaign by several Eurosceptic groups according
to Clarke et al (2016; 2) notably Vote Leave which was led by Conservative MP now Foreign
Secretary Boris Johnson and Secretary of State Michael Gore. The campaign to leave the Union
was characterized by the focus to mobilize public anxiety over immigration, free movement of
EU nationals and sovereignty and the cost of continued membership in the EU. The campaign
articulated giving back autonomy to the voters and saving 350 million pounds that could be
directed to the National Health Services. Those who campaigned for remaining in the union
emphasized on the heavy economic repercussions and major risks that would follow Brexit.
Former British Prime Minister David Cameron and Chancellor George Osborne highlighted the
risks of the decrease in disposable income, tax increase and harsh cuts in public spending and a
fall in GDP by 5.6 % by 2019. Other international figures such as Christine Lagarde of the IMF
have shown their negative sentiments towards Brexit stating that the move would ‘entail global
damage’ whereas former president of the United States Barrack Obama highlighted a negation in
the trade relations that exist between USA and the UK.

1.2 STATEMENT OF THE PROBLEM

The circumstances surrounding Brexit are quite contentious and daunting. This is because of the
ambiguity in the situations and circumstances that are prevailing in connection what really
entails Brexit. There is no clarity on whether this is a complete annihilation of the relationship
between Europe and Britain or would the UK move towards a softer Brexit that will not

3
completely isolate the nation politically and economically. Moreover there is political and
economic uncertainty in relation towards Brexit. On the 24 th of June after the vote investors in
the worldwide stock market lost about 2 trillion pounds. Economists predict a recession in
Britain with the pound dropping in value after the vote. The issue of Brexit has proven to be a
complex one as issues to do with territorial politics and sovereignty have risen. The First
Minister of Scotland Nicola Sturgeon intends on holding a second referendum to decide whether
it wants to remain part of the United Kingdom (In 2014 Scotland held a similar referendum but
voted to stay in the United Kingdom with the fear that it would lose membership of the European
Union by virtue of leaving the UK.) Northern Ireland may opt for its reunification with the
Republic of Ireland as stated by former Deputy First Minister McGuinness highlighted before his
resignation.

1.3 OBJECTIVES OF THE STUDY

The prime objective of the study is to make a an objective articulation of the following
objectives;

 Assess the socio-political and economic impacts of Brexit in the UK

 To ascertain of the trajectory of the relationship of the UK and Europe Post Brexit
 To determine the trajectory of the UK both economically and politically

1.4 RESEARCH QUESTIONS

This comprehensive study while focusing on the socio political and economic impact of Brexit
while seek to answer the following questions;

 What are the socio political outcomes of Brexit in the UK?

 What will the economic climate be for Post Brexit UK
 How will Europe and the United Kingdom relate Post Brexit?

1.5 JUSTIFICATION OF THE STUDY

Embarking on this study was of imperative value taking into consideration the position Britain
and Europe have in the international system. Brexit has not only marked legal amendments in
Britain but has caused a significant rupture in the EU (Ferry et al, 2016; 1) Over the next 15 to
20 years the balance of economic and geopolitical power is likely to change seismically.
Moreover Britain’s commitment to supranational institutions is one to probe into with scrutiny.

4
One would be of the view that de Gaulle in his contempt towards Britain’s membership were
based on the premonition of its Euroscepticism. This study not only sought to make a
determination of Britain’s relationship with Europe afterwards, but also the state Europe after
Brexit and the security of EU nationals after Brexit and the liberal concept of Regional
integration and its continued existence.

1.6 METHODOLOGY
This study took a qualitative approach in research methodology. This study made use of data
gathering techniques such as key informant interviews, documentary search and focus group
discussions. The following paragraphs will be an extrapolation on how these techniques were
exploited so as to give data to make use of in this academic endeavour.

1.6.1 Key Informant Interviews

Key informant interviews were employed to gather information from respondents with robust
knowledge on the dynamics and the prospects be it negative or positive in line with Brexit. The
interviews have been conducted targeting political official such as diplomats of the states in the
European Union and Delegates from the EU to Zimbabwe. Data was recorded manually by
recording the noted from the brief interviews.

1.6.2 Documentary Search

The researcher made use of documentaries, newspaper and magazine articles and internet
resources to obtain the relevant information. News outlets such as the BBC, Al Jazeera, Sky
News and CNN have been consulted in the process. Articles from the Washington Post, the
Economist, the New York Times but to mention a few have been quite monumental in providing
relevant information about Brexit. Also following Public statements by leaders and influential
politicians on social media have been helpful in ascertaining the possible trajectory of the UK
and Europe considering Brexit.

1.6.3 Focus Group Discussions

This research made use of group discussions to acquire information from samples containing
respondents who had been affected by the Brexit Phenomenon. A purposive sampling method
has been employed two isolate two groups each with important components to make a
representative discussion. The two groups were that of tertiary students and working class
citizens, isolating UK nationals and EU nationals. The discussions were facilitated via social

5
media platforms such as Skype and WhatsApp for convenience and logistical purposes. Also
acknowledging financial and time constraints.

1.7 LIMITATIONS OF THE STUDY

In conducting any academic research, a researcher is bound to face many obstacles in his or her
endeavour to establish the facts so as to articulate and expand the requisite knowledge. One
obstacle that was faced was inadequacy in response especially due to late responders when
collecting data. Some respondents did not answer the question but contextualized it in a way that
suited them for political reasons. Also financial constraints were a stumbling block to access the
authorities and the red tape of protocol and bureaucracy involved in contacting the relevant
authorities. Since the subject is a new phenomenon in the academic arena information was be
limited.

1.8 DELIMITATIONS
The study is delimited to the socio political and economic impact of Brexit to the United
Kingdom and to Europe as a collective regional community. Basically the focus of the research
will be directed to the United Kingdom itself and other influential powers in the European Union
that is France, Germany only to mention a few of the EU nations with embassies and consulates
in Zimbabwe. The study probed into closely current developments pertaining to Brexit in the
United Kingdom.

1.8 SUMMARY
This chapter has introduced the topic under investigation. It has highlighted the background and
the structure of the study. It has also articulated the objectives of the study and the research
questions to be asked related to the study. This chapter serves as a building block on what will be
discussed in chapter two that is the literature review, chapter three which will extrapolate data
and analyse it and the fourth and final chapter which will conclude this comprehensive study.

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CHAPTER TWO
LITERATURE REVIEW, CONCEPTUAL AND THEORETICAL
FRAMEWORK

2.0 INTRODUCTION
This chapter will discuss in detail the various concepts and theories related to the topic under
investigation. This chapter is going to be subdivided into sections that is the conceptual
framework and the theoretical framework, looking closely into the literature associated with the
theories and concepts. The concepts to be discussed will include Integration, Euroscepticism, and
Supranationalism versus Intergovernmentalism. Theories to be discussed will include Liberalism
and Realism.

2.1 CONCEPTUAL FRAMEWORK

2.1.1 Integration
This concept came into prominence in the 1950’s as a description of the changes occurring in the
European political and economic structure. Scholars such as Mitrany, Deustch and Haas have
made contributions in line with the concept drawing on sociological theories on functionalism.
Griffith’s et al (2002:158) is of the notion that Integration is best understood as a process
involving;

 A gradual movement towards increased international cooperation

 Gradual ceding of political and economic autonomy to supranational institutions
 Homogenization of values
 Creation of a global civil society

He further highlights (2002:159) the existence of two levels of integration in the international
system. The first would be the Systems level of integration involving transfer of a certain degree
of political, economic and legal autonomy to a supranational body at a global scale. A clear and
concise example would be that of the United Nations (UN).

The second level of integration being Regional integration occurs when a number of states in
close geographical proximity decide to join together to form a federal political and economic
union. Examples of that would include the European Union (EU), SADC, COMESA, and AU
7
only to mention a few. The EU has embodied this concept as an organization of member states in
Western Europe deciding to cooperate in various ways including a single market to foreign
policy. Further integration has been facilitated by several key treaties including the following;

 The treaty of Rome (1958)

 The Single European Act (1987)
 Maastricht Treaty (1996)

Britain’s relationship with the EU in the context of regional integration can be described as a
contentious one. Jones (2007:23) uses the term ‘reluctant European’ to describe the UK’s lack of
enthusiasm to participate in the European experiment, that is, the policy outlook of the union
pertaining to economics and politics. Jones further notes that (2007:172) that successive prime
ministers of the UK have often been at loggerheads or have found themselves isolated from the
organization. A clear example is that of Margret Thatcher and Britain’s budgetary contributions.
This resulting in the demand for a rebate. There is a list of examples which illustrate the
unwillingness for Britain to be fully integrated in the union but to mention a few.

2.1.2 Euroscepticism
Monica Basescu (2014:53) notes that Euroscepticism is one of the biggest challenges being faced
by the architects of new Europe in guaranteeing sustainable integration. This phenomenon has
often been portrayed by international press as associated with ‘economic protectionism’. Flood
(2002:3) defines the term laboriously as attitudes and opinions in discourses and behaviours
(ranging from participation in organized political action to voting in elections or referenda and
responding to public opinion polls) which expresses doubt as to the desirability and/or benefits
and/or long term viability of European or/and EU integration as an objective or in the general
framework created so far or in some important aspects of the framework of institutions,
processes and policies and/or as it is anticipated to occur in the future. Basically elucidating this
elaborate definition, any public activity which involves expressing the sentiment of contempt
towards the institutions and policies of the EU can be considered to be Eurosceptic.

It is important to note that the concept of Euroscepticism has an intrinsic relationship with the
term ‘the reluctant European’ which has been highlighted above. Basically euro sceptics are
opposed to integration with the union as they lack faith in the viability and flexibility of the
institutions. As this concept is also associated with the influx of the electorate around Europe

8
rejecting or condemning the idea of globalization, it is important to mention the sentiment of
globalization as postulated by critics being an ‘elitist agenda’ which does not reflect the public as
a whole.

2.1.3 Supranationalism vs Intergovernmentalism

To those who are opposed to the EU, Supranationalism is a threat to state sovereignty and entails
a creation of a united states of Europe thereby engulfing the state as they know it. Jones
(2007:100) defines Supranationalism as a process where states have to cede some of their
decision making powers to a higher authority i.e. a supranational body in this case the EU. Those
decision making powers are only designated to specific issues. He further notes that, part of the
perceived problem of Supranationalism is the fact that it’s decisions are binding over all member
states in fact, they override national or municipal law and should the two conflict, the gravity of
Supranationalism would be highlighted as being far much greater than mere cooperation
between states. In the case of Britain, the perception of Supranationalism when it comes to the
EU is quite vitriolic. Whenever powers are ceded to the EU, it is seen as a loss in British
sovereignty. EU is portrayed as ‘faceless bureaucrats in Brussels taking over British lives and
telling everyone what to do’ (Jones, 2007:p102).

However, not all elements in the EU are supranational. Intergovernmentalism also exists in the
union. Jones articulates the concept (2007:103) as the idea of different governments cooperating
no ceding of power being involved as the member state remains with their autonomy. Examples
of elements within the EU include the council of ministers and the European Council. Before it
voted to leave Britain was more inclined to the Union being intergovernmental rather than it
being supranational. In this regard Britain would be portrayed as protecting its national interests
within the EU and its sovereignty preserved. This would denote that in that respect the British
had to negotiate with other states to get legislative proposals accepted (or blocked when national
interests where threatened)

2.1.4 Secession
Griffiths et al (2002: p 291) notes that a secessionist seeks to challenge political authority but in
a distinctive way or manner. Secession is aimed at dissolving the state’s power by restricting the
sovereign’s jurisdiction. Secessionists do not deny the political authority of the sovereign in
question but rather the authority the sovereign has over them. Bull (1997:p264-268) shows
particular interest in the scenario where secessionism leads to the devolution of political
9
authority resulting in state autonomy as in the case of Scotland after the Brexit vote. Majority of
the state of Scotland that participated in the Brexit referendum, (that is 62% of the population)
voted to remain in the Bloc. This is apparent that Scotland is pro-European as opposed to
Britain’s Euroscepticism.

The first minister of Scotland Nikola Sturgeon is pushing for a second independence referendum
(the first was held in 2014 in which the majority voted to remain part of the UK), an event which
was termed ‘a once in a generation event’. Her rationale behind the independence agenda is that
the country has the right to self-determination, further stating that May’s conservative
government was using Brexit as ‘a license for xenophobia’ making references to anti-
immigration policies and rhetoric (related to the concept of Euroscepticism above)

However, the bid to vote for Scottish Independence can only be approved by the British
Parliament which happens to be sovereign in the UK. This can be a potential stumbling block for
Scotland’s pursuit for independence as Westminster does not feel inclined to allow this.
According to CNN (March 16 2017), PM Theresa May rejected the demands for a new Scottish
independence referendum stating that ‘now was not the time’ for an independence as Britain
commences negotiations for a suitable Brexit deal. In her interview with the CNN may
highlighted the need for the UK to be united saying “The UK should be working together not
pulling apart.” Her sentiments are that it would be unfair for Scottish nationals to vote for
independence without full knowledge of the terms of the Brexit deal to be negotiated. In that
same regard Northern Ireland may also push for an independence referendum so as to join
Ireland (The New York Times. March 14 2017)

2.2 THEORETICAL FRAMEWORK

2.2.1 Realism
Burchill (2001:30) notes that realism cannot be construed to one dimension but rather has a wide
abode of conceptualizations to the theory. All having a familiar and distinctive flavour to them.
Generally it can be considered to be a school of thought seeking to explain the behaviour of
states in the international system in terms of relative power to each other. Goldstein and
Pevehouse (2014:49-50) are cognizant of the fact that the international system is an anarchic one
hence each state follows or pursues its foreign policy without any altruistic considerations.

10
Hence that policy is expected to embody the advancement of that state’s relative power be it
military or economic. Hence agendas influenced by nationalism are at play when it comes to the
issue of Brexit. It is also valid to note that due to technological advancement and easy access to
information it is now easy for states to be active in how their respective sovereign state conducts
its relations with other states and supranational bodies.

Hans Morgenthau characterized states to have the same mind set and attributes of humanity self-
considering and having a less altruistic outlook than what is propounded by liberalist scholars.
Realism is synonymous with the concept of sovereignty. Griffith et al (2002:299) notes that the
concept originated from the Peace of Westphalia in 1648 which nearly neutralized the extra
territorial authority of the Roman Catholic Church. Contextualizing it with the case of Britain
and Brexit. It can be seen that Britain’s vote to leave and in the process activate article 50 of the
EU charter to leave is a spite against supranational authority which in this regard can be equated
to the extra territorial authority of the Catholic Church before Westphalia.

2.2.2 Liberalism
“We must build a united states of Europe. In this way only will hundreds of millions of
toilers will be able to regain the simple joys which make life worth living”

These were the words of Winston Churchill when he addressed the academic youth at the Zurich
University in 1946 (Peris. Iic, 2010: 2). His words were laced with sentiments of Kantian
liberalism with a vision of creating a cosmopolitan society. However it is quite ironic to note that
even after these words from one of the United Kingdom’s influential leaders, the UK only joined
decades in 1973 after a period of reluctance to join and some obstacles from President de Gaulle.

Liberalism is a theory in international relations that seeks to explain how peace and cooperation
are possible. Immanuel Kant, one of the chief proponents of the theory gave 3 solutions to which
two are related to the study. One would work on the principle of reciprocity whereby
organizations would be created to facilitate state cooperation and the other principle would be
that of promoting trade hence guaranteeing peace through wealth creation and economic
interdependence. These principles hence manifest through the concepts of liberal
institutionalism and neoliberalism

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Liberal Institutionalism or Institutionalism is a school of thought according to Robert and Georg
Soresen (2006) which asserts that international institutions such as the UN, NATO and the EU
can increase aid cooperation between states. This is true in the case of EU as they have been
instrumental bailing out Greece during its economic crises. However the EU as a liberal
institution cannot be said to have enabled increase in cooperation due to British citizens voting to
pull-out of the union in June. This is a clear sign of refusal to cooperate with other states which is
being articulated as fundamental by the school of thought. Neoliberalism on the other hand
according to Keohane and Nye (1989) is a school of thought that believes in states being
concerned with absolute rather than relative gains to other states in the international system.. In
terms of the neoliberal school of thought many are in the endeavour of ascertaining the gains of
being part of the Union be it financial or more ideological. At an angle one may view the union
as an advantage and others would see it fit to leave the union to gain more absolute benefits.
Theresa May and her administration are currently in the process of securing trade partners so that
it is not isolated such as Turkey in January.

2.3 CONCLUSION
This chapter has defined and elaborated in detail concepts and theories related to the subject. The
concepts being Integration, Euroscepticism and Supranationalism versus Intergovernmentalism.
The theories also include Realism and Liberalism. These will in turn help the reader understand
the dynamics of the discussion in question and the topic of research at hand as the concepts and
theories are intrinsically related to the subject.

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CHAPTER THREE
FINDINGS AND DISCUSSIONS

3.1 INTRODUCTION
This chapter presents the findings of this study alongside their critical evaluation so as to
ascertain the actual socio-political and economic effects of Brexit to both the UK and the EU. It
principally responds to the research questions and objectives of the topic in question which
include, probing into the socio-political implications of Brexit to the UK and the EU, the
economic climate of the UK after Brexit, UK and EU relations after Brexit. This chapter presents
and discusses findings of interviews, documentary searches and focus group discussions that
have been made use of to generate data on various dimensions of the subject on Brexit.

3.2 METHODOLOGY
3.2.1 Data Collection Methods
The researcher made use of methods such as interviews, focus group discussions and
documentary searches in collecting data on the socio political and economic impact of Brexit.

3.3 RESEARCH EXPERIENCE

In embarking on the study the researcher faced a number of impediments or obstacles which
would include lack of participation due to lack of interest in the subject or apathy. Moreover due
to time constraints and a lot of protocol required at the relevant embassies in question especially
the British Embassy, most of the data required was not easily obtained. The researcher had to
obtain most of the data from documentary search and consult academics who are closely
following the events of Brexit.

3.4 RESPONSE RATE

In the course of the research and collection of data the response was not entirely satisfactory to
the researcher especially in line with the interviews and focus group discussions. However this
was circumvented by assistance from teaching assistants from the department of Political and

13
Administrative studies who have been following the events closely and the Embassy of the
European Union which has been helpful and cooperative in the endeavour.

3.5 THE MAJOR OBJECTIVE OF THE STUDY WAS TO ASSESS THE

SOCIO-POLITICAL AND ECONOMIC IMPACT OF THE UNITED
KINGDOM’S EXIT FROM THE EU (BREXIT)
One should acknowledge that the UK’s decision to leave the EU as validated by the referendum
of 23 June 2016 has had a profound and monumental effect on British Politics and a seismic
impact on the EU as well in the realm of the globalization frenzy. Moreover a lot of dynamics
are at play considering the legal ramifications pertaining constitutional prerogatives of ‘who is
supposed to do this and who has the right to say that’. One of the socio-political questions is
whether Brexit will leave the United Kingdom United or will it divide the nation. Moreover will
the UK’s economy be as competitive as it was before Brexit is also an intriguing question.

3.5.1 Economic Impact of Brexit in the UK

a) The Financial Services Sector
One of the pertinent questions asked during the Brexit campaigns and after the referendum was
whether the economy of the UK would be affected as it is one of the major powers in the
international system. According to Al Jazeera (27 June 2016) the results of the referendum had
an immediate economic effect as it shook global markets as two trillion dollars on the 24 th of
June was lost and the loss increasing to three trillion dollars by the 27 th of June, having what is
termed “a trillion dollar impact”. As of late the pound as compared to the dollar has deteriorated
in value as it fell by

The Economist’s special report on Brexit (2016:12) buttresses the point above, noting that
London, Britain’s financial hub has a lot at stake with regards to leaving the EU. London is
considered to be the financial centre of the EU and the Euro zone and it invites challenge from
potential rivals such as Paris and Frankfurt. In a research conduct by a lobby group known as
TheCityUK, 2.2 million people are employed in the financial services sector, producing 12% of
GDP, 11% of the country’s tax take and a net surplus of 72 billion pounds. Moreover financial
services constitute over a third of FDI in Britain since 2007, most of it coming from the EU (250
foreign banks operate in London). However due to the loss of what are termed pass porting rights
(the facilitation of easy trade of European financial institutions to operate freely across Europe)
.It would be difficult for financial services to be effective in London or the UK leading to a

14
possible shift from London to other competitive financial hubs, hence reducing employment and
FDI.

b) Trade
Another impact to be noted was articulated by one of the respondents from the E.U embassy who
alluded to the fact that 60% of the UK’s trade was with the EU hence it would be safe to say that
the UK would be losing one of its biggest trading partners. This is also buttressed by statistics
provided by Infacts.org in a short video documentary highlighting that the EU bought 44% of
British exports which constitutes of 13% of the UK’s GDP. Hence this could potentially affect
Britain’s national income

c) Foreign Investment
According to Woodford, the EU is an important source of FDI for the British Economy which
accounts for 46% of the UK’s stock of inward FDI. .Moreover many investors who are not
member states of the EU have been attracted to the UK due to its convenient membership in the
union. This is because the UK’s membership provides access to free movement of capital and
labour and a zero tariff environment. One might say that these multinational companies are
benefiting the privileges of the UK’s membership lucratively. Hence it is safe to say that the UK
stands to lose a lot of FDI due to the Brexit initiative as it would no longer be attractive to invest
in the UK without those benefits. Figure 1 and Fig 2 shows the stock of FDI in the UK up to
2013 (as taken from the Woodford Economic report)

15
Figure 1 Stock of FDI in the UK from 2005 to 2013 (Taken from the Woodford Economic
Report)

Figure 2: Graph Illustrating the FDI inflows into the UK (Taken from the Woodford Economic
Report 2016)

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3.5.2 Socio-Political Impacts of Brexit in the UK

a) Security

One of the most pertinent questions concerning Brexit is whether Britain or the UK will be more
secure in the EU or out of the EU. It is important to note that the EU for the past 25 years has
developed its common foreign and security policy (The Economist, May 14, 2016), an aspect
known as collective security in the confines of regional integration. Theresa May during her
tenure as home secretary stressed with the utmost gravity the necessity of EU membership when
security is concerned, saying that the EU made ‘Britain more secure from crime and terrorism’.
John Sawyers, a former boss of the MI6 is also on record in the Sunday Times (May 8, 2016)
saying that EU mattered to British security and leaving the EU had the potential of
compromising British security.

However Euro sceptics have a different perception of the issue as they counter argue that Britain
is much more secure without Europe. In a focus group discussion facilitated by the researcher
through Skype one of the participants argued that EU was not important in guaranteeing British
security saying;

“Why should the UK worry about security post Brexit when NATO is available? I am of the
opinion that as the UK we have capable alliances that can guarantee us security”

This argument has fundamental value as it highlights the fact that the UK is not that vulnerable
without EU membership. Moreover a key group when it comes to security and intelligence is the
“five eyes”, comprising of Britain, the USA, Australia, Canada and New Zealand The Economist
(14 May 2016) in an article alluded to the impediments towards national security which were
viewed by Euro sceptics as those which compromise national security, taking into consideration
the jurisdiction of the ECJ interfering in security protocol and migration which is seen as a major
loophole in EU guaranteeing UK security.

b) Secession
It would seem that the Brexit phenomena has ignited the pursuit for self-determination by
Scotland and possibly Northern Ireland. In a BBC news press conference (June 13 2016) Nikola
Sturgeon highlighted the likelihood of a second independence referendum as a result of the

17
outcome of the Brexit vote. It is important to note that Scotland voted to remain in the EU as
validated by the 62% majority that voted in that aspect. In a debate to decide whether to pursue
Scottish Independence Nikola is on record saying that “Scotland’s future should be in Scotland’s
hands”, thereby validating her stance on seeking national autonomy. Figure 3 shows Scottish
Nationals protesting for independence.

It is important to note that in 2014 the people of Scotland held a referendum geared at
determining their continued union with Britain in which Scotland voted to remain part of the UK.
This being considered ‘a once in a generation’ event by pundits. With this occurrence one would
say that the Brexit outcome has strengthened the position of the SNP which has been pushing the
agenda for Scottish independence as this may this potentially lead to Scottish nationals seek to
evaluate their relationship with the UK. A relationship which was formed on the basis of the
Acts of Union of 1707 that combined the two parliaments under a shared monarchy

Theresa May however has vehemently rejected the independence agenda of Scotland until the
negotiations of Brexit are over basing on the rationale that UK can get a better Brexit deal if
united. Hence making the UK, s position less vulnerable. For Northern Ireland according to Euro
News a referendum for reunification with Ireland could not be ruled out. This showing that
Brexit has divided the United Kingdom and disintegrated it.

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Figure 3 Scottish Nationals demonstrating in Glasgow for Independence (Taken from the New
York Times March 17 2017)

c) Immigration
Immigration was the voter’s main concern and could have possibly motivated the vote to leave
(The Economist, April 2 2016). So it can be safe to assume that there is a correlation between
hostility towards immigration and the vote to leave the EU. The question of migration has been
an important part of the Brexit dialogue. The question of whether Britain or the UK has
autonomy over its borders.

According to Wadsworth et al (2016:35) between 1995 and 2015 the number of EU immigrants
has tripled from 0.9 million to 3.3 million. Fig 4 illustrates the trends in migration from the EU
to the UK. These EU immigrants are of working age, highly educated and more likely to work
whilst less likely to ask for benefits than the UK nationals. This poses a problem as UK nationals
feel threatened that EU nationals are much more competitive in the labour market.

Now due to Brexit it is most likely that Britain will attain the capacity to formulate its migration
policy which will suit the needs of Britain. As Theresa May in an interview by Andrew Neil
broadcasted on the 23 of March 2017 alluded, “Britain would be in control of its boarders and set
rules for the EU nationals that would come in.” Hence the resultant would be autonomy over
boarders. However one must also be aware of the repercussions of Brexit in line with

19
immigration. With reduction of immigration, comes increase in tax and reduction of public
spending leading into austerity measures as migrants pay significantly higher tax than the UK
citizen with lesser benefits from social welfare as alluded by Murray and Hanson (Bloomberg
Intelligence Report, 2016:4). Moreover leading to higher wages due to the reduction of the
labour force and higher interest rates and possible inflation (Woodford Report on the Economic
Impact on Brexit, 2016)

It would be an injustice to look at immigration after Brexit from a negative perspective. It can be
perceived as a win for Britain to have autonomy and monopoly over its boarders thereby
enabling it to deter the possibility of terrorist attacks. This can be seen as a benefit in light of the
incessant terrorist attacks which are being blamed on the EU’s refugee policy and crises.
Examples include the Charlie Hebdo Attack of January 2015 (www.express.co.uk),
Westminster’s attack of March 2017 and German attacks of July 2016. These attacks have a
commonality of being perpetrated by Islamic fundamentalists who have gained access into
Western Europe through the EU.

Figure 4 Migration in the UK (Taken from the Woodford Economic Report)

e )UK political Climate Post Brexit
Brexit ushered in seismic changes in British Politics as seen through the resignation of David
Cameron as PM and the ascendance of Theresa May to ‘the captaincy of the ship’ as some

20
analysts would say. It is important to note that initially May was vote remain lobbyist but in her
first speech as prime minister her stance ‘Brexit means Brexit’ (www.psa.co.uk) has astonished
many. In her first days she has partitioned the foreign affairs office into three departments whilst
purging most of Cameron’s closest allies, inclusive of Michael Gore and George Osborne.

However May’s government is facing a plethora of challenges and obstacles in implementing an

effective Brexit that would leave Britain in a better position. In her press conference announcing
a snap general to be held on the 8th of June 2017 (BBC News) she highlighted the disunity in
Westminster;

“At this moment of national significance, there should be unity here in Westminster but instead
there is division.…Labour has threatened to vote against the final agreement we reach with the
EU, the Liberal Democrats have said they want to grind the business of government to a
standstill …”

This, further articulates the stalemate in Westminster that has precipitated due to Brexit as it is
seen as an opportunity by other parties in the British political system to gain political mileage
and relevance. It is important to note that the PM has the prerogative to call for snap election
whenever he or she sees fit in accordance to the Fixed-Term Parliaments Act. Paul Nuttall
highlighted that May’s resolution shouldn’t be taken in the context of progress but a decision to
consolidated her position and gain political power when he commented in an interview by the
BBC that as she had seen that the Tories were 20 points ahead in the polls hence prompting her
to make such a decision.

Brexit has also affected Political parties in Britain in terms of support and policy stance even
leadership structure. The ascendancy of Jeremy Corbyn to be the Labour party has been seen as
an unconventional development also it has prompted the decline in Labour support and an
increase in the Liberal Democrats support illustrated by their victory in Richmond Park London
in December’s by-election (www.bbc.com). This would culminate in the conclusion that Brexit
has shaken Westminster’s politics.

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3.5.3 UK/EU RELATIONS
Armstrong et al (2016:29) asserts those who advocated for leaving the EU had fundamentally
different views on how the UK’s future relationship would be.

 Some intend to preserve many if not all of the single markets benefits, this would entail
limitations to national policy
 Others view the EU as stifling British progress and intend to sever ties enabling it to
make deals on its own and setting its own regulations.

There is no single perspective to this issue as it has a lot of complicated considerations. One
should bear in mind that the EU is Britain’s biggest trading partner accounting for 13% of its
GDP (as alluded to above) hence the relationship between the UK and Britain is not one to take
likely

Government Policy towards the EU

Theresa May highlighted two important standpoints when it comes to Brexit at the Conservative
Party Conference held in Birmingham last year;

“We are not leaving the EU to give up control of immigration all over again. And we are not
leaving only to return to the jurisdiction of the ECJ”

The Brexit negotiations which will determine the future relationship of the UK and the economic
bloc will take two years subject to extension and May’s statement is an indicator of where the
UK’s government is not willing to compromise.

However in an interview broadcasted by the BBC on the 29 th of March 2017 she alluded to her
letter of beginning the process of withdrawal saying;

“In a letter that I have sent to trigger this formal process today I make the point that we’re not
rejecting Europe, we’re not rejecting values of democracy and European values”

This statement highlights a different stance from being hardliners and more of a concessionary
approach towards the Brexit process. The UK wants neither a ‘hard Brexit’ (UK/EU trade

22
relations being conducted by WTO regulations) nor a ‘soft Brexit’ (UK accepts the indivisible
four fundamental freedoms), rather it seeks what PM May highlights as a ‘British Exit’. In which
the government’s initial position of negotiation would be;

 Continued membership in the customs union and not the single market
 Access to the free trade area (FTA)
 Participation in EU programmes that don’t require EU membership e.g. Horizon 2020
and Erasmus
 PM ruled out the ECJ but not the EFTA court

Member State’s Policy

Armstrong further asserts that member states maintain a united position related to Brexit. that
free movement - as one of the ‘four freedoms’ – is fundamentally important to both the EU and
single market, and the fact that the UK is not prepared to accept free movement it cannot hope to
replicate anything resembling current arrangements for trade in goods and services (including
financial services). However, while this stance rules out ‘associate’ single market membership
for the UK post-Brexit, it does not entirely preclude the sort of complex mixed approach
described above. So far, there is little or no evidence that other EU member states have moved
beyond their reflexive (and understandable) rejection of the UK’s desire to ‘have its cake and eat
it’ to consider what their attitude might be to a more sophisticated and less obviously
unreasonable proposition.

3.5.4 CONCLUSION
In summation this chapter unveiled research findings that covered much ground on the socio-
political and economic impact of Brexit. The impacts affect trade, FDI, financial services which
are economic impacts. Politically issues pertaining to security, immigration and politics in
Westminster. Also the UK’s relationship with EU was also a subject in the research.

23
CHAPTER FOUR
CONCLUSIONS AND RECOMMENDATIONS

4.1 INTRODUCTION
This chapter summarises the research conducted in its complete nature. The findings and
conclusion will assist the researcher in giving a concise analysis and a forecast on the trajectory
of the UK post-Brexit. This chapter will also indicate and elucidate alternative that can be
explored by the UK so as to ensure socio-economic and political stability after its concluded
relationship with the EU.

4.2 CONCLUSIONS
Taking into consideration the research undertaken and the information gathered, it would be
appropriate to deduce that the impact of Brexit may entail negative repercussions rather than
positive ones. However it would be a huge injustice not acknowledging the positive impact it
brings.

Brexit brings with it uncertainty and volatility in the socio-political hemisphere of the UK. This
can be confirmed by taking into consideration first the aftermath of the vote as markets shook
and the pound’s value fell rapidly. Dhingra and Sampson (2016:2) augment this line of argument
describing Brexit as ‘taking a leap into the unknown. The effects of the decision to leave are still
to be realised and it has promoted or propagated a tense atmosphere in the UK. Brexit has
revealed the weaknesses or the shortfalls of the ‘Globalization mantra’ and the unfeasibility of ‘a
borderless society. It is important to acknowledge that immigration has been a major issue which
was used by the Eurosceptic camp in Britain to really consolidate and assure the realization of a
vote Leave outcome in the referendum of 23 June 2016.

This process has shaken Westminster politics to the core and has facilitated unprecedented
seismic changes to the front liners in British Politics. Through witnessing the demise of Cameron
and the rise of May, Corbyn and Nuttal to the echelons of their respective political parties, one
can see the effect of Brexit quite apparently. This has also caused division in government
24
especially in the legislative structures as each faction or sector view the issue of Brexit in a
different light. The rise of political opportunism should be noted basing on the view that Brexit is
being used as a utility to consolidate and attain political mileage or relevance. A clear example is
that of the SNP whose agenda of Scottish independence has been revived by the advent of
Brexit. It has also influenced the domestic politics of other member states of the EU as one can
see the emergence of Eurosceptic populists like Lapene rise to prominence in French politics and
right wing parties gaining political momentum in their respective realms.

The issue of state sovereignty should not be ignored especially by supranational institutions as it
is a stumbling block to full integration and cooperation among states. Sovereignty and self-
determination of the nation state should not be discarded as redundant in international politics as
it is one of the major factors that pushed the Brexit vote. May is on record saying that Brexit ‘is
about Britain gaining self-determination ‘and not having regulations being imposed by faceless
bureaucrats in Brussels. The same can be said for the lobbying of Scottish Independence by the
SNP.

4.3 RECOMMENDATIONS
Brexit is a complicated and unpredictable matter. Hence the British Government has to approach
it with judicious discernment thus guarantying economic, political and social stability in the UK.
As it is an ongoing process which can no longer be reversed, the UK will have to look for
alternative solutions that guarantee continuity and prosperity for their citizens.

Trade Relations

One solution that should be considered is the negotiation of a deal that would guarantee the UK
access to the Customs Union and the Free Trade Area. As highlighted in the research, the EU is
the UK’s biggest trading partner and a fall out with the EU may damage the economy of Britain
significantly if not handled properly. A possibility to explore could be the Norwegian Model.
Dhingra and Sampson (2016:4) allude to the notion that a possible alternative would be for the
UK to follow the model being used by Norway and join the European Economic Area (EEA).
This would entail being part of the single market without EU membership with the following
conditions;

25
 EEA members are not obliged to participate in the monetary union ,CAP, Foreign
Security Policy and the EU’s Justice and Home Affairs policy
 They would be not part of the customs union hence they are able to determine their trade
tariffs and negotiate trade deals with other countries without EU regulation
 They would remain in the Single Market only paying 17% lower of what they used to pay
for the EU regional contributions

However this model has its downsides as;

 Non EU Members in the EEA must accept and implement EU legislation pertaining to
the Single Market without having a say.
 By joining the EEA the UK will be surrendering more sovereignty (an aspect they want
at all costs to avoid) as it would be giving up its influence in the EU

Another alternative option would be to follow the Swiss model. Switzerland is not a member of
the EU or the EEA. Rather it has put in place bilateral treaties that govern the relations that exist
between Switzerland and the EU. Switzerland is also a member of the EFTA which enables it to
have access to free trade in all non-agricultural products. However this model still leaves a lot to
be desired. Under the ‘Swiss’ model the EU will have no obligation to guarantee access to
markets in the EU.

Trading with the EU under WTO regulations is a possible option the UK can explore as it will be
able to negotiate trade deals independently of the EU and not subordinate to its regulations.
However trade under WTO regulations would be costly as trade would be subject to MFN tariffs
and no free access to EU markets. Moreover goods would have to be scrutinized under EU goods
standards. The UK may also look to trade with other nations or trading partners that are not in
the EU. Entities like BRICS that have recently come into prominence can be attractive options to
explore.

Socio-Political Environment

The socio-political environment requires decisive action so as to guarantee stability. Coming to

immigration it would be prudent for the UK to assure EU nationals security and put in place
legislation to control the inward flow of immigrants, putting regulations and criteria on those

26
who enter the UK. It would also be wise to approve of a Scottish Independence Referendum so
as to relieve pressure from Westminster. Taking into consideration that sovereignty is a principle
that drove Brexit, it would also be fair that the UK let Scotland decide and define its fate as a
nation whilst maintaining strong ties in acknowledgement of a shared history and heritage.
Theresa May’s call for snap elections may be considered to be a strategic and decisive move.
Considering that her party has a 20 point lead in the opinion polls, this will actually assist her
administration consolidate power so as to implement her vision for Brexit without impediments.
Moreover it gives the other political parties the platform of articulating and aggregating their
vision of Britain if they are to win.

4.4 CONCLUSION
Brexit has proven to be an issue worthy of reckoning. The aftermath of the referendum shook the
global scene as it caused a seismic shift in the understanding of regional integration. Brexit may
lead to undesirable repercussions and complications in the UK. However the will of the citizens
of UK has to be respected and every nation has the right to determine its destiny.

27
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