The Nation Newspaper

Tag: Brexit

  • Cameron resigns from UK parliament

    Cameron resigns from UK parliament

    Former British Prime Minister David Cameron, who stepped down from the United Kingdom (UK)’s top office as a result of the vote for Britain to exit Europe (Brexit) in July, has resigned from the UK parliament.

    According to Britain’s Press Association on Monday, Cameron announced that he will stand down as a member of parliament for his constituency of Witney immediately.

    Details shortly…

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  • Brexit: U.K. property market may crash

    Brexit: U.K. property market may crash

    For Nigerians and other nationals, owning a property in the United Kingdom (U.K.) is a viable investment because of its huge returns. But less than a month after the country signed up to exit the European Union (EU), otherwise known as ‘BREXIT’, investing in U.K. properties may no longer be that attractive as experts have predicted a 30 per cent drop in value, writes MUYIWA LUCAS.

    London property prices could fall by more than 30 per cent in the wake of Britain’s vote to leave the EU and may halve in the most expensive parts of the city, according to analysts at the French bank, Société Générale.

    Brexit may be the trigger to end London’s seven-year house-price boom as companies move employees out of the U.K., forcing sales of high-end properties, the company’s real estate analyst Marc Mozzi said in a note to clients.

    Commercial property has been at the centre of post-Brexit fears as investors have tried to get their money out of property funds, but residential real estate could be hit harder, Société Générale said.

    “While in recent stress tests the major UK banks were assessed with declines of about 30 per cent in commercial real estate prices, we fear that London residential could experience an even more severe downturn,” it said.

    Sean Farrell of UK’s The Guardian writes that prices are already falling on properties previously valued at £1m or more, and may have further to go, particularly in the priciest parts of the city, such as Hammersmith and Fulham as well as Kensington and Westminster, as well as other high priced boroughs where London’s highly paid investment bankers and hedge fund managers congregate.

    Société Générale added: “We see a classic housing bubble in London and Brexit as the trigger for the correction.  Given the current ratio of prices to incomes in London, a price correction of even 40-50 per cent in the most expensive London boroughs does not seem impossible.” This prediction is premised on the fact that London property prices have more than doubled since they began to recover from the financial crisis in 2009. Last month, the average London house price was £472,000 – 12 times average London earnings, compared with a long-term average of six times, Société Générale said.

    Brexit could push those stretched conditions to breaking point by forcing about 3,000 senior employees of financial firms to sell their London houses to relocate to Europe, Mozzi said. That would be more than a year of transactions in the market for homes costing £2million or more, leading to big potential declines in prices.

    Many non-UK banks and other financial companies base their European operations in Britain because EU membership allows them full access to the single market. That “passporting” arrangement may end when the U.K. leaves the EU, forcing companies to relocate businesses to Europe.

    Mozzi cited a report by a reputable accounting firm, Pricewaterhouse and Coopers (PwC), before the referendum that said Brexit could result in between 70,000 and 100,000  people employed in the financial sector. The report, published in April, compared likely post-Brexit numbers in 2020 with a forecast for jobs if the UK stayed in the EU.

    Another firm of estate agents, Savills, presented a less gloomy picture though. It said London sellers were already adjusting prices, while interest rates are expected to stay low and the pound’s fall could attract overseas investors to buy property.

    “The vote in favour of Brexit suggests that political and economic uncertainty is likely to remain a feature of the market for some time to come. Of course it is not all negative news. We expect the newly formed UK government to be highly motivated to protect London’s position as a major global financial centre in any negotiations with the EU,” Savills said.

    Mozzi said the pound’s fall was unlikely to have a lasting positive effect on investors, who will hold off if they fear further falls in the value of sterling will reduce the value of purchases.

     

    What’s next for the housing market?

    According to Susan Emmett of The Spectator, UKm since buying a house is a major decision, few people will want to commit to such a life changing purchase in times of uncertainty. Therefore, she noted, it is no surprise that the confusion, fear and downright shock that followed the EU referendum vote to leave has had an effect on sentiment in the housing market.

    Figures from the latest survey from the Royal Institution of Chartered Surveyors have confirmed what is been all already suspected – that Brexit uncertainty has had an impact on market activity. From the survey, new buyer enquiries declined significantly across the UK in June to its lowest reading since the mid-2008. The survey also recorded further decline in sales and many expect this to continue. Last month also saw a reduction in house price growth. While values are still rising at a national level, they are doing so at a more moderate pace.

    However, the extent to which this is a consumer reaction, than to political upheaval or a sign of things to come in the housing market is still unclear. Appetite for clarity of the direction of the housing market is only matched by the dearth of data that would allow stakeholders to properly assess the situation. Emmett said it will be autumn before all the numbers are in and even then, there will be great potential to misread the runes.

     

    Tough decision

    Emmett observed that for every homeowner worried about the potential erosion in the value of their asset, there is also a prospective first-time buyer rubbing their hands and hoping for the kind of price drop that would really help them get on the ladder. But she explained that none of this is any help for someone in the middle of buying a home for the first-time or trading up. Should you just get on with it or wait? And if you do wait, how long for and will it be worth it?

    Over the coming weeks and months, stakeholders in the housing sector expect buyer caution to continue and consumer sentiment to fluctuate as negotiations to leave the EU proceed. This will have an impact in the number of sales, with fewer deals done. As a result, transaction numbers are likely to fall from the annual high of 1.3 million recently recorded. The extent of that decline will depend on other factors- how mortgage lenders react, the strength of the economy and how that affects consumer spending power.

     

    Shape of things to come

    But at this point, analysts say it’s business as usual as far as mortgages go. The base rate is at 0.5 per cent this month but the cost of borrowing is likely to stay lower for longer. The Bank of England is at great pains to ensure the lending cogs continue to turn. It has already eased capital requirements for banks, potentially freeing up £150 billion of capital. Lenders’ choice of customers, however, will be the thing to watch. Should banks perceive a risk, they will be less likely to lend to borrowers with small deposits who require loans at large multiples of their income. That might raise the stakes for first-time buyers and particularly impact on London where affordability is already quite stretched.

    Further down the line, economic factors will determine the health of the property market. Household finances could come under pressure from a spike in inflation triggered by a weak pound. The prospect of slower economic growth is likely to constrain income growth, reducing spending power further still. All this is likely to affect house price growth. Already, the pace of activities in the sector has slackened and this could continue.

    Emmett submits that at this stage however, there may not be many forced property sellers. In fact, one of the key features of the market at the moment is a lack of property for sale. She however didn’t rule out price falls in some markets where affordability is really stretched, leading to house prices being underpinned by low interest rates and low supply.

  • LASU x-rays Brexit

    The Faculty of Arts, Lagos State University (LASU) has organised one-day seminar on the exit of the United Kingdom (UK) from the European Union, and its global implication, as well as the fate of Nigerians living in the UK.

    The UK voted to withdraw from the European Union (EU) in a referendum won by the ‘leave camp,’  forcing Prime Minister, David Cameron to resign.

    Going down memory lane, Dean of the faculty, Prof Abolade Adeniji, traced the origin of the EU to the time the continent engaged in inter-ethnic and inter-fratricidal wars that eventually culminated in the Second World War. According to him, the six founding countries of the EU-Belgium, Germany, France, Italy, Luxembourg and Netherlands – also made the move to liberate Europe from technological and economic backwardness before and after the war.

    Adeniji of the Department of History and International Relations believed neither Nigeria nor the UK would benefit from the Brexit phenomenon. However, his colleague, Pius Akhimien from the Department of English, thinks otherwise.

    Akhimien said Brexit would leave the blacks with some advantages as to countries they would henceforth, interact with regarding politics and economy.

    Dr. Dapo Thomas of the Department of History noted that the development has opened a new vista for Europe.

    “I strongly feel that with this development is precedence; and Europe may never be the same again as countries that may feel disenchanted in EU, might want to toe the line of Britain,” he said.

    According to him, Brexit phenomenon simply means it could kickstart the rise of European nationalism.

    Adeniyi Harrison, a professor of Linguistics from Departments of African Languages and Literatures, noted that the English Language, which the EU has adopted for deliberations may now face a growing threat from other member countries of EU.

    “Now, my concern borders on the implication on the continuous use of the English Language by EU? Since Britain is no longer part of them, there may be resistance against the use of its language,” Harrison  noted,  while examining the linguistic implication of Brexit.

  • ‘Brexit vote worsens global economic outlook’

    ‘Brexit vote worsens global economic outlook’

    Britain’s decision to exit the European Union (EU), has further depressed the global economic outlook in the years ahead, the International Monetary Fund (IMF), has said.

    The global financial institution said in a publication due for release today, that the outcome of the U.K. vote, which outcome it stated came as a surprise to the global financial markets, implies the materialisation  of an important downside risk for the world economy, saying as a result, “the global outlook for 2016-17 has worsened, despite the better-than-expected performance in early 2016. This deterioration reflects the expected macroeconomic consequences of a sizable increase in uncertainty, including on the political front. This uncertainty is projected to take a toll on confidence and investment, including through its repercussions on financial conditions and market sentiment more generally.”

    IMF said the initial financial market reaction, expectedly “ was severe but generally orderly,” stating that  as of mid-July, the pound in response to the unexpected development, “weakened by about 10 percent. “ It said despite some rebound, equity prices stayed lower in some sectors, especially for European banks; and yields on safe assets have declined.

    However, before the June 23 vote in the United Kingdom in favor of leaving the European Union, economic  data and financial market developments suggested that the global economy was evolving broadly according to forecast in the first month of the second quarter of the year, the IMF said in its  World Economic Outlook (WEO).

    It said growth in most advanced economies remained lacklustre, with low potential growth and a gradual closing of output gaps, pointing out that prospects remained diverse across emerging markets and developing economies, with some improvement for a few large emerging markets, amongst which were Brazil and Russia, indicating a modest upward revision to 2017 global growth relative to the April’s 2016 forecast.

    IMF said  with “Brexit” still very much unfolding coupled with  its unpredictable outcome, the extent of uncertainty complicates the already difficult  task of macroeconomic forecasting.

  • Cameron bows out with jokes

    Cameron bows out with jokes

    David Cameron entertained parliament with a series of farewell quips on Wednesday in his last appearance as prime minister before making way for Theresa May to lead the monumental task of extricating Britain from the EU.

    “This morning I had meetings with ministerial colleagues and others.

    “Other than one meeting this afternoon with Her Majesty the Queen, the diary for the rest of my day is remarkably light,’’ Cameron said to roars of laughter in a packed House of Commons.

    He was due to present his resignation to the queen at Buckingham Palace at around 1600 GMT.

    Then May will pay her own visit to the monarch to be formally entrusted with the job, before entering 10 Downing Street to become Britain’s second woman prime minister after Margaret Thatcher.

    Meanwhile Cameron stepped down after Britons rejected his entreaties and voted in a June 23 referendum to quit the EU, weakening the 28-nation bloc and creating huge economic uncertainty.

    Apart from the task of executing ‘Brexit’, May must try to unite a divided party and a nation in which many, on the evidence of the vote, feel angry with the political elite.

    There was an atmosphere of hilarity in parliament as Cameron traded humorous jabs with beleaguered opposition Labour leader Jeremy Corbyn,in spite of the serious backdrop.

    “I am beginning to admire his tenacity; he is reminding me of the black knight in Monty Python’s Holy Grail.

    “He is been kicked so many times but he says ‘Keep going, it is only a flesh wound, I admire that,’’ Cameron said.

    He took the opportunity to trumpet his government’s achievements in generating one of the fastest growth rates among western economies, chopping the budget deficit, creating 2.5 million jobs and legalising gay marriage.

    However his legacy would be overshadowed by his failed referendum gamble, which he had hoped would keep Britain at the heart of a reformed EU.

  • Brexit cost Zlatan over £20k a week at Man Utd

    Brexit cost Zlatan over £20k a week at Man Utd

    Zlatan Ibrahimovic will earn approximately 10 per cent less during his year at Manchester United as a result of Brexit, the Financial Times have claimed.

    They usually steer clear of the world of football, but the salmon-pink paper has this week turned its attention to how Britain’s decision to leave the European Union would affect the Premier League and some of its top earners.

    Their main subject of interest is Swedish superstar Ibrahimovic, who last week joined United on a year-long contract, with the option for a further 12 months.

    The former PSG, Juventus and Barcelona striker reportedly agreed the move to Old Trafford at the end of last season, but with the deal not being officially confirmed until last week, the paper claims Ibra’s sterling-denominated pay packet was worth roughly 10 per cent less against the dollar from the time the deal was agreed to when it was executed.

    While it is hard to have too much sympathy for a man earning a reported £220,000 a week, the paper feels Brexit will impact on Premier League clubs’ hopes of signing certain players.

    With Arsene Wenger voicing his concerns this week, the FT also wrote: ‘One person close to a Championship club said an Italian player demanded an increase in wages following Brexit because of the disadvantage of being paid in pounds. The deal subsequently fell through.’

  • Brexit and its aftermath

    I was in London about two years ago when the referendum on whether Scotland would exit the United Kingdom of England, Wales, Scotland and Northern Ireland was held. Mercifully the Scots seemed to have had doubts about the wisdom of abandoning a time tested union. The entire United Kingdom in this new referendum has decided to leave the European Union  to which the Conservative government of Edward Heath took them into  in 1973  about 43 years ago. The British Prime Minister David Cameron gambled like his Labour predecessor Harold Wilson did in 1975 by directly consulting the British people about whether to stay or leave the European Union apparently believing in the good sense of the British to stay but he was disappointed by the result. It needs to be stated that the leave vote was not overwhelming. It was 48 to 52 percent. But whatever the margin was, it was still a clear decision to leave. Many people in the United Kingdom are however unhappy about the result. Scotland and Northern Ireland, two of the constituent nations making up the United Kingdom voted clearly to stay in the European Union. The capital city of London also voted to stay and more than four million petitions against leaving the union have been signed within the first week after the referendum. To me, all these will amount to nothing. The deed has been done and the consequence will remain for years to come. The Scottish government has gone to meet the EU officials about its desire to stay in the European Union. It is also threatening to hold another independence referendum which it lost two years ago. There is of course no certainty that the Scots would vote to sever ties with the United Kingdom if the Scottish government were to run precipitously into a new referendum. Plaid Cymru, the Welsh nationalist party which is almost a spent force is also joining its Scottish counterpart in threatening a dissolution of the United Kingdom. Northern Ireland has not said much apart from Sin Fein the nationalist party there unconvincingly saying it may call for unification with the Republic of Ireland. The problems on the issue of possible union of Northern Ireland with the Republic of Ireland are so fraught with danger of renewed civil war that no serious politician would dare raise the issue at this volatile time. Nothing is really predictable these days.

    There is of course no doubt that the economic repercussions of BREXIT would have serious ramifications in the United Kingdom. Its economy would definitely contract gradually during the next two years of its negotiation to exit the European Union. Its currency is weakening and there is a long term forecast that the pound sterling will be at par with the American dollar which will be almost a 20 percent depreciation. The result of this may be positive or negative. It will make British goods cheaper on the world market but the negative aspect is that imports like oil to Britain will be costlier since this is priced in dollars and there is not much left of North Sea oil. Inflation will rise and there will definitely be job losses arising from headquarters of multinationals moving their European operations out of London to Dublin, Paris or Frankfurt.

    The political instability that exit from Europe has already created can be seen in the disarray in both the Conservative and Labour parties. The Conservative Party would not have a new leader until the end of August and Jeremy Corbyn  has just lost a confidence vote in his leadership by the labour parliamentary  party. Ordinarily he should have resigned but he is banking on the illusion that the rank and file of labour members outside parliament are with him. He foolishly thinks they approve of his lack-lustre performance since his election last year. If he does not go, the Labour Party may witness history repeating itself with the coming into being of a new party as happened in the 1970s when the brilliant Roy Jenkins formed the Social Democratic Party and took substantial members of the Labour parliamentary party with him. No one knows what will happen this time and the situation in the Conservative party is also not clear.

    In the Conservative party, Boris Johnson the openly ambitious and flamboyant London mayor may put people off because of his putting his own interest above that of country. The man who was riding the horse of anti-immigration to achieve the BREXIT victory is now saying he would not insist on banning immigrants coming to Britain in exchange for access to the European Union. He says there was more in the campaign than just anti-immigration. Yes there are other things but the poor electorate was sold the dummy of a stop to immigration and impliedly an expulsion of those who are here already in order to create jobs for Britons and school places for their children as well as huge funding of the national health services through retaining and transferring to it 350 million pounds sterling allegedly being transferred by Britain every week to the European Union. It has now turned out that the BREXIT campaign was based on outright lies. If Boris Johnson loses, the current Home Secretary Theresa May could emerge as consensus candidate. The political vacuum is creating instability all around Britain and anti-social elements are beginning to vent their pent up anger and racism on European immigrants and visible minorities of Blacks and Asians. People are being bullied, heckled and physically assaulted on the streets and told to go back to their home countries irrespective of how many generations they have stayed in the United Kingdom. This dangerous trend is being watched by the security people and politicians are being asked to rein in their unruly supporters.

    The BREXIT no doubt would have negative effect on the European Union itself. There is fear that other members may follow BREXIT. France under Marie Le Pen, its racist and right wing politician may take a page out of the British exit. If that happens, the European Union will disintegrate. This is why the British will be harshly rebuffed when it dreams of negotiating a new deal that will guarantee it the advantages of the free market without commitment to free movement of labour. The European Union too will see its influence and its market and economy diminish by BREXIT and even the global economy will witness a decline in growth as has been predicted by the IMF.

    The British are living in the past of “RULE BRITANNIA, BRITANNIA RULE TH E WAVES “. Some of the BREXIT campaigners are citing Australia and New Zealand as already asking to trade with Britain as if that can replace a near market of over 500 million people in Europe. On the day of the referendum result, I heard one of the leaders saying Ghana had indicated its readiness to enter into new trading relations with Britain. What a joke! This shows the level of propaganda the BREXIT people will go. Of course Britain will survive as a viable country; the question is whether it will thrive. The USA would do all in its power to assist the British but it would not choose Britain over Europe no matter how many times the Obama administration parrots, tongue in cheek, the so-called special relations with Britain. Britain is in post-industrial phase of its development relying mostly on service industries of banking, insurance, legal services, shipping, aviation and international education and tourism. All these can be wiped out by growing racism and xenophobia.

    African countries will not be seriously affected by BREXIT. Our trade nowadays is mainly with China, India, European Union and to a lesser extent the United States. The coming decline in the United Kingdom’s economy will lead to diminution in technical assistance. This however cuts both ways. Besides the time has come when we should depend on ourselves and pull up our countries by our own bootstraps. The economic volatility which BREXIT caused would however settle down and one sincerely hopes Scotland can be persuaded not to trigger the liquidation of the British Union.

  • Brexit: Nigel Farage resigns as UKIP leader

    United Kingdom Independence Party leader, Mr. Nigel Farage, on Monday announced his resignation from the position and active politics.

    He said it was time to leave the scene having achieved his goal of securing a vote for Britain to leave the European Union (EU), the News Agency of Nigeria (NAN) reports.

    Farage, who led the right-wing party for 10 years, said he was stepping down to focus on his personal life.

    He had spent long years campaigning for Britain to exit the EU.

     

  • CIBN, stakeholders x-ray impact of Brexit on banks

    CIBN, stakeholders x-ray impact of Brexit on banks

    The Chartered Institute of Bankers of Nigeria Centre for Financial Studies (CIBNCFS), a subsidiary of The Chartered Institute of Bankers of Nigeria (CIBN) at the weekend held a breakfast session on the implications of Brexit on the Nigerian banking industry.

    Speaking during the programme, Chief Consultant Biodun Adedipe Associate Limited, Dr. Biodun Adedipe, said the United Kingdom’s (UK’s) surprise vote to leave the European Union (EU), could have negative consequences on Nigerian economy considering its strong economic ties with Britain, as a member of the British Commonwealth.

    He said the bilateral trade between Nigeria and the UK, currently valued at six billion pounds and projected to reach about 20 billion pounds by 2020 could be affected.

    He said a decelerating British economy could impact a drop in investment, trade, and also remittances from the Nigerian Diaspora who sent home over $20 billion in 2015.

    Chief Executive Officer, Proshare Nigeria Limited, Femi Awoyemi, however said that Nigerians who own property in the UK are going to find that their rental income will be lower in naira terms.

    But the representative of the deputy CBN Governor and Director Monetary Policy Department, Moses Tule, said that there is nothing to be worried about. He said that Brexit will not lead to global economic crisis, adding that financial institutions are more regulated and capitalised now than previously.

    Tule noted that crisis in UK will not affect any Nigerian banks, including lenders with subsidiaries abroad. At the event were delegates from the financial system regulatory institutions, deposit money banks, development banks, microfinance banks, insurance companies, capital market operators, academics, private business owners and other key stakeholders in the economy.

     

  • From ruins of Brexit to consultative integration

    Britain’s vote to leave the European Union (EU) has understandably caused consternation worldwide, in Nigeria and Africa broadly. Questions are being asked regarding the likely impact of Brexit on Nigeria-UK relations and whether African states should curtail economic integration plans. The British vote exposed flaws in Europe’s integration, so these questions merit a dispassionate assessment with clear answers that can point the way forward for Nigeria and Africa.

    To assuage doubts over closer African integration post-Brexit, it is vital to reflect on the nuances of the EU project and how its downsides can be avoided. The real tragedy of the Brexit referendum is of relevance here: complex questions such as the EU’s contributions to the most peaceful phase of European history, and how well the EU has served British interests, were ultimately reduced to a simple ‘yes’ or ‘no’ vote.

    A more dispassionate analysis points to ample evidence of EU successes worthy of being emulated by Africa. Just as well, the EU’s more controversial aspects present lessons that can guide budding African initiatives, including the ambitious tripartite free trade area (FTA) planned to integrate eastern and southern African countries within the SADC, EAC and COMESA blocs. On opening borders, facilitating free movement of business people (not permanent immigration) and liberalizing trade across its 29 member states, the EU acquitted itself well. It helped Europe to expand prosperity in a way that Africa ought to replicate practically and more concertedly. Pursuing this as corrective to Africa’s largely haphazard borders will boost trade, cooperation and catalyse development.

    In terms of functional and supranational undertakings, Europe provides a credible template for policy alignment in health, the environment, hygiene and other areas such as efficient energy pools. These merit domestication into the African contextand present a forward-looking example for Africa. Similarly, closer engagement in science and technology has spurred successful European projects such as the Airbus, assembled with component manufactured in diverse countries from the UK, through France, to Spain, Germany and Italy.

    However, in terms of fiscal and monetary union, serious contemplation and caution may be in order. The euro currency, adopted by the Eurozone states since 1999, has proved to be a strait jacket for some of the adopting countries. Precisely when Portugal, Italy, Greece, Spain, Ireland and Cyprus needed monetary policy agility and other spaces to escape their debt-induced economic crisis, lack of autonomous control over the shared euro currency exposed serious design flaws in Europe’s monetary union. Notably, Africa has its own example of monetary union in francophone west and central Africa, which is arguably more successful and narrower in scope than the grand euro project.

    The one particularly controversial aspect of the Brexit debate focuses on immigration and labour mobility. This needs thoughtful regulation to avoid the backlash that may come from poor consultation and management of concern among ordinary citizens. Workers in Britain, Spain and elsewhere resented what appeared to be a runaway influx of migrant workers into their labour markets as the EU extended membership to a number of former Soviet-controlled eastern European states. Even as successful open economies like Britain’s celebrate the gains of globalization, loud grassroots protestation on migrant labour’s more adverse impacts on local communities was left to fester. The blame for this collision between local job security and EU-wide labour mobility partly lies at the doorsteps of EU leaders. With poorly managed immigration left to strain local communities and resources, a backlash like Brexit was long in the offing.

    Moreover, the top-down elitist approach that has characterized European integration will ill-serve Africa. Brexit presents an opportune moment for architects of Africa’s regional integration to reassess. Africa must avoid the EU’s missteps and build cooperation projects with not only people and social rights at its heart, but also prioritise substantive popular consultation whilst eschewing the temptation to impose on citizens. Failing this, Africa’s regionalization push will neither stand the test of time nor pass the test of popular legitimacy.

    Another dimension of the elitist tendency that hemorrhaged support for the EU is the disconnect between elite bureaucrats in Brussels and ordinary European citizens without jobs or hope in places like Greece and Spain. This Mediterranean fringe of the EU has borne the brunt of the EU’s collective economic failures, even as institutions like the European Parliament failed to respond decisively, whilst continually seeking more power and control against the will of national electorates. To be sure, the EU (and the West’s) mismanagement is widely blamed for transforming the US sub-prime mortgage crisis into the sovereign debt crises that severely undermined Club Med economies as privately held debt stocks were transferred to sovereigns.

    Closer to home, Africans worry about the likely impact of Brexit on African economies, and Nigerians also pose questions on how the referendum fallout may reshape Nigeria-UK relations. In truth, political relations will likely remain on an even keel, though more visible impact is to be expected in the UK’s diminished economic attractiveness both in the short term (owing to the expectation of prolonged negotiations to define the terms of the UK’s divorce from the EU) and the longer-term (as Britain’s resetting internal political relations and external economic agreements may take even longer to work out). Both will compound British and foreign business decisions. Britain itself potentially confronts the inconvenience of re-establishing UK diplomatic posts such as at the African Union headquarters and other locations where collective EU representation had been hitherto possible through the European External Action Services (the EU’s equivalent of a foreign ministry).

    For Nigerian investors and businesses, much like their peers from around the world, we may see a shift away from the view of London as gateway to the EU. With foreign businesses contemplating alternative locations for headquarters or hub operations, and the waning appetite among high net worth individuals (including Nigerians) who previously paid a premium for London real estates, UK property price growth is likely to slow. Broader economic uncertainty could also take hold. Paradoxically, this may attract less speculative, longer-term property investors attracted by lower prices. Put simply, London outside the EU is unlikely to be as attractive a gateway unless the UK magically manages to preserve much of the privileged access to the Common Market that its erstwhile EU membership conferred.

    Doubtless, the effect of Brexit will be felt at a personal level for many Britons and UK permanent residents. This author’s own story leads to the inexorable conclusion that Brexit represents a setback for Europe-wide cosmopolitanism.  The future mobility of British professional classes in Europe will be uncertain. After residing in the UK for nearly 15 years, acquiring British citizenship very early on his sojourn, this author went on to live in Madrid as part of the sizeable UK contingent resident in Spain. Many Nigerian-British professional and Nigerian permanent residents in the UK who have grown accustomed to crisscrossing European borders freely may confront a steep adjustment phase with respect to mobility. With the Brexit outcome heavily premised on the presumed out-of-control EU and non-EU immigration to the Britain, it is unlikely that a post-Brexit government will open the country to new workers from the EU. In return, EU states will likely reciprocate with their own restrictions on British expats. Nevertheless, the extent of such tit-for-tat restrictions remains unclear since the formal process of severing the UK from the EU will only commence after David Cameron, the British prime minister, relinquishes power in October.

    On a strategic level, there may well be opportunities for Nigeria and the UK to explore in terms of the latter’s expressed intention to upgrade commercial ties with other partners and blocs such as the Commonwealth, in which Nigeria is one of the bigger economies. Here the UK’s focus is undoubtedly on Australia, New Zealand, US, Canada and India. Nigeria, however, can explore potential trade niches. It is conceivable that Nigerian negotiators might succeed in persuading British counterparts to open up to Nigerian agricultural goods and processed foods, in the way they have not been able to convince EU interlocutors. This will be helped by the proposal of some Brexit supporters to immediately drop all tariffs on goods coming into the UK. This is premised on the unproven assumption that others are likely to reciprocate. Such uncertainties, if well exploited, could provide opportunities as Nigeria pushes to resuscitate its agricultural sector for local food supplies and export markets like Britain.