After the World War II, six nations started European Union with the object of duty-free trade. During 1973, Britain joined in European Union, and the European Economic Community was created in 1957. Brexit is a term indicated the process of leaving with European Union. The referendum was conducted on Thursday June 23, 2016. The voters asked through referendum whether the Britain should remain member of the European Union or leave European Union. A historical decision came out resulting Britain exist from the European Union.
The economic problems could not be properly addressed by European Union even since 2008. The unemployment rate was 20% in Southern Europe whereas it was just 4.2% in Germany. The established trade barriers by European Union completely against to Britain. On the other hand, Germany’s intention to trade war with Britain. The organizations including IMF, NATO and EU lost the confidence with the Britain. There is a fear of losing control on the organizations mentioned, and people find Brexit is the only solution. Immigration policies became national issue and badly influenced on the internal life of the country.
The impact of Brexit on the member countries will vary which depends upon the connectedness with the UK and its policies. High impact of Brexit noticed with the countries like Netherlands, Ireland and Cyprus. And Italy has low impact Brexit. In specific areas, the group countries including France and Poland are more exposed (Irwin).
The rest of Europe adversely influenced with the cost of raising finance in Europe. The cost also influenced on the export, supply chain and other investment policies. The member states in EU will feel impact of Brexit and it influences political and economic factors. Global economy was affected whereas trillion dollars of investment with United States was under threat.
Brexit badly influences on the countries of UK, Europe, and Unites States even world. In the next three years, there will be chance of reduction of economic growth up to 5.6 percent. The countries forced to renegotiate the deals as there was sharp decline in the pound and other disruptions in the trade within nation.