Next Thursday, Her Majesty people are invited to a referendum regarding United Kingdom exit from the European Union. The issue is in the front page of newspapers, not only in England. Stock markets are worried and yesterday, Janet Yellen, Federal Reserve chairwoman, was considering it as a risk to the point to probably differ any rate increase in her country during next sumer, increase which was considered as certain three months ago. President Obama launched a formal call in favor of remaining in the Union, but European leaders were less vocal, as they are cautious to avoid creating any negative reactions.
Poll opinions, until last week, were fluctuating, error margins being larger than the gap evaluated between the two sides. It is not anymore the case now, since the “leave” side seems to have increased its lead. In fact, during last elections, the same poll opinion institutes were heavily wrong in forecasting a defeat of the Tories. Yet, they got an absolute majority. And current comments are rarely about the real issues about this poll. First, what is the question the electors are supposed to answer? It doesn’t command an answer by yes or no but a choice between two options: to leave or to remain. Then, what is really at stake in that poll? It is much less clear that it is usually said since it is a consultative poll which has no immediate legal consequences. During the 2005 referendum in France about European constitution project, the issue was to approve a treaty which would come into application, or to reject it, and in that case, it would be abandoned. In the current poll, there is nothing like that. It will be the duty of the British Parliament to elaborate the legal consequences of a politician poll. If the “remain” side wins, the compromise negotiated in February by David Cameron with Brussels to soften the constraints generated to London by its Union member status, will enter into application.
But if the “leave” side wins, the situation will be much hazier. It has already been announced a two year period, with a one year possible extension, during which will be negotiated the terms of the exit. At the end of this period, the British Parliament will decide. Many things can happen until that time, with first, David Cameron resignation, the constitution of a new government, based on a majority consistent with the results of the poll, which is, we have to repeat it, not a true referendum as we have in France. But it is the point where problems become harder because, except if there is an alliance with UKIP, a populist right-wing party, Tories supporting the exit, have no majority. It is even not impossible that the Conservative party explodes. The most probable hypothesis is that snap elections will be decided and that the new government will have the mandate to negotiate the conditions of the exit.
In this hypothesis the possible outcome is large since the legal conditions governing relationship with the Union are diverse. The European Union is not the only formula which defines the relations between people. The United Kingdom may first ask for joining the Economic European Space or the former free-trade alliance, like Norway or Island. There is also the adoption of a specific treaty as with Switzerland and it is the most likely solution, in case of a success of the “leave” side. England did not join the euro and is not part of Schengen rules, which are the most restricting regarding national sovereignty. Concerning social legislations, including detached workers or the free movements of workers, the February compromise gives increased margins to the country. So, it is highly likely that the economic consequences of an exit will be very limited, the United kingdom keeping free trade agreements for goods, services and capital flows of course, to protect the interest of the City of London as a financial center. And we don’t imagine Brussels creating obstacles to that. That will not protect against a fall of the pound. But this currency has only a marginal role on foreign exchanges markets. It will not be good news for retired English people living in France or in Spain but this fall will allow France to regain its position as the 5th economy in the world, which it lost in 2015, due to the fall of the euro against the pound. For England, the risk remains of being confronted with a rebound of secessionist movements in Scotland and Northern Ireland which, historically, have considered London with more mistrust, no to say hostility, than Brussels. These two parts of the United Kingdom could find the opportunity to restart their demands.
Regarding Europe, the symbolic character of a Brexit has much heavier consequences. Either European countries, and first of them Germany, don’t understand the signification of the British leave, and next days will be difficult, or at the opposite, lessons are learnt from this hitch and in the coming years, a new generation of political leaders will permit to the European continent to rebound on different basis which will better take into account people aspirations. But, shouldn't it supposed to be their primary duty?