The United Kingdom left the European Union at 23:00 GMT on January 31, 2020. New arrangements are yet to be negotiated, but no changes in trade or transport will immediately be felt. However, the presence of the UK in EU institutions and the European Parliament has ended.
London is now free to enter trade talks with all third-party countries in parallel to its negotiation with Brussels. After Brexit, Britain is no longer a part of the EU’s external trade arrangements.
The EU loses some 15 percent of its economy valued at $2.7 trillion. It also bids farewell to the City of London, its most important global financial center until now.
These are the most obvious downsides for the EU. The real problem, though, is the intangibles. Brussels loses some of the best and most pragmatic functionaries. The faction that has resisted centralization and the bureaucratic vision of a transfer union has been weakened. The ranks of the supporters of the market-driven economy – as opposed to a socialist central planning system – have been depleted. One must not forget the farsighted policy of London which supported an expanding union rather than a deepening one envisioned by the statists, especially in Paris. Britain strongly favored including Central Europe into the Union.
With the UK gone, Brussels’ tendency to press for further “harmonization” and an “ever closer Union” is likely to become more onerous. This mindset only strengthens the centrifugal forces within the EU. The result could be either an overcentralized, globally uncompetitive Union or even its disintegration.
Brexit, a regrettable development, resulted from a shortsighted electoral game in the UK combined with bureaucratic principalism and a deficit of pragmatism on the continent. Unfortunately, it does not look like European capitals have learned the lesson. The ever-closer Union lobby continues to press on.
The European project represents a unique opportunity for the continent. It was off to an excellent start. Today, however, the cancer of centralization and unnecessary harmonization is emaciating Europe’s body. The loser of Brexit is Europe.
Prince Michael of Liechtenstein
Chairman and Founder