Post-Brexit reality - why British "exodus" will benefit Africa
- Author Giorgi Mikhelidze
- Published December 20, 2019
- Word count 1,152
It’s undeniably one of the most cataclysmic periods we live in. Everywhere around the world, the conventional institutions that have been shaping the western world and its root values are starting to disintegrate or lose the people’s support. Take a look at Donald Trump’s presidency in the United States and everything will start to make a little more sense.
This trend is also visible in the United Kingdom. While the country has always been somewhat skeptical of the common European project, with its historical peak being Margaret Thatcher’s Euroscepticism, the UK has surpassed itself a bit more than 3 years ago.
How Brexit was initiated
In 2016, the Britons voted for the UK’s membership in the European Union. Its then Prime-Minister, David Cameron, made this referendum one of the most crucial promises of his election campaign. Although he never really considered the possibility of people voting to leave the union, that was exactly what happened. And it killed his whole career as well.
With the tiniest margin possible of just 51%, the UK population made their choice to leave the EU that they’ve been a part of for almost half a century. And the implications of this decision are pressing.
First off, every single agreement and contract that made trade between the EU and the UK virtually limitless, from this moment onwards, everything has to be renegotiated. And this process can take ages. Besides, the corporations and businesses will no longer be that enthusiastic about establishing their headquarters or branches here. For example, Elon Musk is already considering moving his future Gigafactory from the UK to Germany. And these kinds of examples are abounding.
Things might be looking up for Africa
However, despite the fact that Brexit poses a serious challenge to both the EU and the UK, it might have a positive impact on other countries and continents. Africa, in particular, is expected to see a flow of new possibilities both economic and politic-wise.
African countries such as Kenya, South Africa, etc. are already catching up with global financial trends and developments. For example, the top-rated FX brokers in Kenya are starting to incorporate some of the most recent financial technologies such as blockchain in their services. And this suggests that things are already looking up on this continent. However, with Brexit and drastic overhauls on the European soil, those countries might have the opportunity to revitalize their trade deals with the UK.
Trade relations with the United Kingdom have always been crucial for the countries of the African Commonwealth and their economic development. In 2012, for example, this cooperation reached its highest peak at $120 billion of trade volume between the two parties. And some of the African officials are enthusiastic that Brexit will take these relations even further.
According to some financial analysts, when the UK divorces from the EU and embarks on its new, independent economic course, it’s going to be much simpler for the Commonwealth countries to strike individual trade deals with it.
Uk-Commonwealth face-to-face negotiations
Before Brexit, every single trade or any other economic contract had to be negotiated with the EU as a whole. And collectively the EU was much more rigid and inflexible, making the negotiation process less beneficial to the Africans. But after Brexit, individual negotiations are the only framework for the UK-Commonwealth economic relations. This way, African officials could potentially strike more lucrative deals with the EU-divorcee.
South Africa is one of the most obvious cases of this beneficial situation. Before this realization that Brexit could potentially benefit South Africa, they were somewhat frightened that their country would experience a severe economic decline. And it was logical since the country was so dependent on the European economy.
However, after the British revealed their reinvigorated interest in the South African economy, those fears have been more or less alleviated. Now, South Africa expects that the trade volume with the UK will increase, bringing new investments and new jobs in the country.
However, we shouldn’t expect that Brexit will be all rainbows and sunshine for Africans. As we mentioned above, there is a probability - and even the inevitability - that this process will undeniably hurt the European economy in general. And since the UK isn’t the only focal point of the African Commonwealth, the crisis might also damage the latter if it undermines Europe. Just the fact that almost a third of South Africa’s exports come to Europe makes things more apparent. But still, the damage can be mitigated once closer economic ties are established with the UK.
But since the united kingdom may try and look into new markets once its links to Europe area unit diminished, African countries may truly stand to learn. And we can already sense this increased interest from the British corporations and businesses to invest in African industries. Even the British Trade Minister, Liam Fox, has expressed his enthusiasm that the trade relations could be further strengthened with the Commonwealth.
Strength lies in unity
One of the things that are absolutely necessary to ensure is that African countries need to stand together if they want to achieve tangible results with the UK. One-by-one, they’re significantly weaker and susceptible to political manipulations. And while we want to think of the UK as a democratic and fair country, it’s still capable of turning trade negotiations with the Commonwealth to its benefit.
According to Brian Wanyama, a Kenyan Economics professor, the African nations have always been successful at striking successful and lucrative deals if the stood together under one common organization. The same can be achieved in the negotiations with the UK. If they stand united, their chances of getting a better deal out of the UK are much higher. If not, the latter will have its way.
Specific African regions have their own expectations of those negotiations. For example, the East African countries are hopeful that the UK will give them a better starting point than the others. The reason for their optimism is the fact that back in the 40s and 50s, the UK-EAC relations had already been established and flowing on good terms. And for them, the preferable conditions from the UK is rather logical to expect.
However, no one really knows what the thought process behind Britons’ and the British politicians’ minds really is. One thing that’s pretty obvious is that the whole process of Brexit was initiated as a sign of a self-revolving trend in the country. The British people have expressed their tiredness of common politics and universal concerns - they want to take care of themselves.
However, how Brexit can satisfy their desires is quite another thing. Yet one thing is clear: the challenges posed and implications caused by this cataclysmic decision will take the global politics and economics to a new road - a somewhat rocky and patchy road, if we may say so.
https://oec.world/en/profile/country/zaf/Article source: https://articlebiz.com
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