The End is In Sight - But for Whom in the Game of EU Brexit
EU Brexit for Expats Blog
ProACT Sam Orgill bring you a Weekly Update on EU Brexit for Expats
“In the Game of Thrones You Win or You Die” Cersi Lannister told the Noble Edwin Stark. And so it seem in this weekly drama of EU Brexit for Expats. Very political, high risk stuff. There will one winner it seems, who will that be? EU, Merkel, Crobyn, France, Russia, Saudi, Nicola Sturgeon of the SNP, Boris Johnson, Theresa May?
“It’s the economy stupid” was a campaign phrased by a relative of mine, James Carville, as campaign strategist for Bill Clinton in the 1991 Presidential election. It was successful in an election campaign that unseated the sitting president George W Bush, who lost in an campaign held during a recession.
Teresa May is in an election campaign that will run until 23:00PM on 29th March 2019 when the UK will be committed to leaving the EU, a date to be written into UK law. If she gets the government that far. Until that date anything could change and everything may.
UK Recession
Theresa Mays big issue is the Pound Sterling Exchange rate fell sharply the day after the election, from around Euro1.30 Euro 1.12 to GBP£ 1.00. The 25% fall has seen more expensive imports to the UK, more expensive exports to the EU, more expensive holidays in Europe for Brits. This has slowly squeezed the UK consumer at home, the traditional driver of the UK economy, leading to falling spending, and industrial unrest, even with full employment.
A lower currency would give lower priced exports and stimulate international trade it was thought, but not enough to ward of a recessionary feel about the UK economy by the middle of 2017. With the masses uneasy the political heat is gradually increasing for the UK government.
Corbyn and Labour made spectacular gains in the general election, and now push for another UK General election in 2018 they think they will win. EU Brexit is an easy target to undermine the Maybe government.
The EU think they have a weak partner so push the envelope further to extract a great price of Brexit, something May is unable to accept politically as she would appear weaker, and be replaced.
Merkel wants the UK to stay, Germany benefits most from a massive EU trade Surplus, and stand to lose most trade if the UK leaves and leaves on poor terms.
France have a new president focused on restoring the French economy, and attracting City of London Finance business is a ripe cherry to pick.
Russia who knows. A major world economy like the UK free of the EU could become an even better trade partner.
Saudi are having a mini revolution and modernisation. To turn from an insular closed economy and country to an open modern progressive Muslim economy requires friends, and an independent UK may be a friend indeed.
The SNP would hope for any misfortune to be fall the May government, and allow a new Scottish independence referendum as soon as possible, using the EU Brexit as an excuse is an ideal political platform.
Boris wants to be Prime minister, and wants EU Brexit, he will influence the process to his agenda in the background, while he wants Brexit, and he also wants May to be replaced sooner rather than later.
Strong Signs
Which leaves Theresa May to set the agenda and go her way. She is providing strong leadership, dealing directly with leaders, making behind close door deals. Warning off UK politicians, calling the people to her side.
But will it be enough?
There is a recession, unless she can turn the economy around, and quick, then support for her and her government will ebb away, her government will die, and there will be other winners.
Rising interest rates are a start. They should make the Pound Sterling stronger on international currency markets that could lead to a stronger currency, reduce inflation and prices in the UK.
Brits could all afford to go on holiday in Euroland then next year.
The November Budget is another big test. If on 22/11/17 the Budget hits tax payers and companies and expats hard, the loser Maybe the government. Political wolves sensing weakness will attack a weak looking government,
The outcome Maybe still EU Brexit, but on whose terms is up for grabs, as is the ultimate winner in the UK Game of thrones – EU Brexit 2018-19 season.
STAY IN TOUCH
There is so much going on in the world in the moment it can be hard to stay in touch.
In our weekly Living and Working Abroad Newsletter ProACT Sam brings to you a broad brush approach to Tax, Wills, Immigration, Property, Pensions, Investment and Business from the ProACT Expat Experts. Above all we keep you updated with our Friday EU Brexit for Expats Blog.
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Sam Orgill
ProACT Partnership - Tax Saving Experts
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