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Brexit Update: A Standstill

Image: BBC.com

On April 10, 2019, the EU and the UK government both agreed on impending the deadline of Brexit, and they are going to make the final decision on October 31, 2019.

The tension of Brexit started in June 2016. A referendum about whether the UK should leave the EU or not got 51.9% of people voted yes, compared to 48.1% voted no. The UK is supposed to make its final decision two years later on March 29, 2019. However, after Prime Minister Theresa May requested to extend the date, the deadline has been postponed to October 31, 2019.  

There is no doubt that Brexit will cause many impacts not only on the UK economy but also on immigration. Although the UK has not made its final decision, the uncertainty has already slowed down the UK economy, a 1.8% decrease on economic growth in 2018 and a 1.9% decrease in 2019. The British pound is also influenced by the uncertainty, which dropped 14% after the referendum.

Beside that, the unemployment rate has reached the lowest rate in 43 years at 4%. The annual growth of house prices also decreased from 8.2% to 1.7% between 2016 and 2019.  

Before the UK leaves, the EU wants the UK to pay a “divorce bill”, which is a £38bn outstanding EU budget commitments, also known as the financial settlement. Therefore, some people supported a no-deal Brexit to avoid the huge cost.

However, if the UK leaves the EU in a hard way, it will hurt its own economy more.

According to the data from The Guardian, scholars forecast that the UK economy could be 9% weaker in the long term. Nonetheless, Members of Parliament (MPs) claimed that the situation would not be as bad as other people thought because the UK is able to save a huge amount of money and freely trade all over the world.

When it comes to border, EU members and the UK will have to erect a physical boundary which they used to not have, especially the 310-mile border between Northern Ireland, UK territory, and Ireland.

After border control, Brexit will also affect the flow of goods between each country, limit the food selections in British stores, and potentially hike the prices of food. Food supply owners also have not been ready for the extra cost of the new trade deal, which is falling on their shoulders.  

Until now, it is hard to tell whether Brexit would continue to damage the UK economy in the long run or not. Only time will tell.