right. Add this to British expatriates in other EU countries which could in theory become illegal immigrants overnight if Britain does not maintain some form of freedom of movement as part of its settlement with the EU.
Economically, a recession in Britain seems likely. Corporate investments will be hurt by uncertainty about future access to both the single market and other zones where Britain has piggybacked on trade deals negotiated by the EU. In unsettled times, businesses defer whatever spending they can and this will hurt the economy.
For example, the fear that Brexit might mean recession, plus sheer uncertainty, sent shares in Barclays and Lloyds down by almost 30% when the market opened. European banks were not spared: Deutsche Bank shed 21%, Credit Suisse and UBS 13% each. Shares in American banks with bases in London fell at the start of New York trading. Added to that, the Pounds Sterling fell to its lowest in over three decades.
Britain’s financial industry could also face severe difficulties. This is because it thrives on the EU’s “passport” rules, under which banks, asset managers and other financial firms in one member state may serve customers in the other 26 without setting up local operations. That is how the British subsidiaries of non-EU banks are able to do business throughout Europe from London, and a big reason why London became the EU’s financial capital. The city might lose this privilege. According to the JPMorgan Chase boss, Jamie Dimon, jobs could be lost. HSBC is mulling shifting 1,000 people, around one-fifth of its staff in London, to Paris. Most people are of the view that clearing euro transactions in London would become harder.
What is more, Britain may also quit the European Health Insurance Card (EHIC) which covers Britons for urgent health treatment in Europe either free or at same cost as that of a country’s citizens. With Brexit, membership of EHIC will be negotiated.
There are also fears that Brexit could lead to the fracture of the United Kingdom as we know it. If Scotland decides to leave the UK and join the EU, it might trigger Wales into toeing the same line and Northern Ireland into reunification with the Republic of Ireland. Even within the UK Parliament, the two major political parties are suffering internal cracks as politicians trade verbal punches.
Implications for Nigeria
Nigeria will surely be affected by whatever wind that is blowing across the British Isles. As a member of the British Commonwealth, Nigeria has strong economic ties with Britain. Nigeria is Britain’s second largest trading partner in Africa after South Africa, with £6 billion (about N2.4 trillion or $8.52 billion) in bilateral trade volume in 2015 alone.
However, if Brexit, as many expect, leads to the shrinking of the UK GDP, it will lead to a scaling back of investments by British investors which will affect the volume of trade with Nigeria. With Nigeria boasting a sizeable population in the UK, if the British economy goes into a recession, it will affect the financial muscles of the Nigerian Diaspora in the UK and by extension, remittances back home. Brexit could also trigger a weakened European economy. A weakened Europe would affect Nigeria in terms of aid to Nigeria. Britain accounts for about 15 percent of EU’s operational budget.
Moreover, it would foster anti-immigration policies around the world, and this will affect Nigerians as they have a large population of its citizens in Diaspora. It is expected that Britain will be very strict on visa applications especially from countries like Nigeria with large visa applicants to the United Kingdom.
Brexit is likely to send the wrong signal in Nigeria. With re-emergence of ethnic nationalism across Nigeria, many are already calling for a Brexit type of referendumfor Nigerias to decide their destiny. Such calls will not go away soonest.
Implications for the EU
If Britain does well outside the EU, other member states could follow the exit door. Ratings agency believes Brexit will create a precedent for any country to leave the EU and this will increase p