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Brexit: Steps should be taken to protect economy

Amirul Islam || risingbd.com

Published: 14:00, 26 June 2016   Update: 15:18, 26 July 2020
Brexit: Steps should be taken to protect economy

Britain has voted to leave the European Union, results from Thursday`s landmark referendum showed, an outcome that sets the country on an uncertain path and deals the largest setback to European efforts to forge greater unity since World War Two. Through this landmark referendum, the country is going to end its relation of 43 years with the European Union.

Prime Minister David Cameron, who has worked splendidly to keep the UK economy afloat, has announced his decision to leave office. The future of George Osborne, Chancellor of the Exchequer and the Government’s economic enforcer, also looks precarious.

Meanwhile, stock markets have responded negatively, not just here in the UK but across Europe and the rest of the globe, impacting adversely on the pensions and investments. This incident will also impact the growing economy of Bangladesh as Britain is the largest export market for commodities.

World financial markets dropped as nearly complete results showed a 51.7/48.3 percent split for leaving. Sterling suffered its biggest one-day fall of more than 9 percent against the dollar, hitting its lowest level in three decades on market fears the decision will hit investment in the world`s 5th largest economy.

The vote initiated at least two years of messy divorce proceedings with the EU, raised questions over London`s role as a global financial capital and put huge pressure on Prime Minister David Cameron to resign, though he pledged during the campaign to stay on whatever the result.

From the very beginning, there was a strong political debate among the country’s political parties over Britain entrance to European Union. Conservatives were aggravated as a good number of immigrants entered into the country from many countries of Europe.

The UK Independence Party (UKIP) is a Eurosceptic and right-wing populist political party in the United Kingdom. UKIP was founded in 1991 by the historian Alan Sked as the Anti-Federalist League, a single-issue Eurosceptic party. Headquartered in Newton Abbot, Devon, its leader is Nigel Farage. Under Farage`s leadership, from 2009 the party tailored its policies towards the white working-class, before making significant breakthroughs in the 2013 local elections and the 2014 European elections, where UKIP received the most votes. At the 2015 general election, the party gained the third largest vote share and one seat in the House of Commons. Before the 2015 general election, the Conservative Party leaders and incumbent Prime Minister David Cameron were forced to declare referendum pledges on EU issue in the face of pressure.

At last, Britain voted to leave the European Union on Friday, defying warnings of economic disaster and isolation to deal a thunderous blow to the 60-year-old bloc that sent world markets plunging. Investors scrambled to sell the pound, oil and stocks as a divided Britain took a lurch into the unknown, becoming the first country to quit in the EU`s history, a culmination of decades of suspicion over Europe. The shock vote also threatened the unity of the United Kingdom, with Scotland unwilling to follow the rest of the country out of the EU.

United Kingdom is third largest export market for Bangladesh. Bangladesh exported products worth $2.02 billion to the country in the fiscal Year 2013-14. Bangladesh has exported 100 percent of duty free products except arms to the country as a member of European Union. After the split from the EU, questions have raised whether there will be duty free facilities anymore for Bangladesh.
Besides, Department for International Development (DFID), a development organization which leads the UK`s work to end extreme poverty, building a safer, healthier, more prosperous world, has continued to provide grants including poverty alleviation programmes in various projects in Bangladesh. What will happen for Bangladesh if Britain saw crisis in its economy?

The prerequisite of a sustainable and durable economy is the ability to take precautionary measures about the future risk and to achieve that ability. Two years are needed to end the entire process of exiting Britain from the EU. Our government should plan now by holding a discussion regarding the issue as the United Kingdom is one of the development associates and export markets for Bangladesh.

risingbd/Dhaka/June 26, 2016/Shahed/Amirul

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