Why BREXIT is good for EU

“Leave as soon as possible” tells EU chiefs to UK as soon as it emerged that a majority of Britons feel it is good to exit an expensive organisation like EU, the one which forces UK to accomodate more migrants than its emigrants. It is not an emotional outburst of EU chiefs coming out of frustration of a big brother deciding to leave the 28 nations, comparatively more successful regional economic block. It makes more business sense for EU to get rid of this10th biggest net contributor (net contribution around 13 Bilion pound).

In order to understand the situation better, one need to go back to the formation of EU itself in 1972. Before EU was established most experts had concurred that an EU makes an economic sense if it is a congregation of equals. But that condition was never met. The result has been that EU has remained an unbalanced ship sailing throughout its history. The Greece crisis made it very clear to all the members, that some weaker members were enjoying the economic cooperation at the expense of citizens of some core members, having spending like those members. So already EU had been a tilted ship. Brexit is a sure reducer of such a tilt albeit to a smaller extent in short run, but has the potential to accelerate the process to make EU more and more balanced in the long run. A variable geometry of EU, for example, is a possibility now, comprising of a core of strong members with loose outer layer of member countries ‘in the making’. Or something similar which is now possible. EU chiefs have already placed their strong calls for introspection and feel confident of a better EU.

Brexit is not about economics, it is about xenophobia and outcome of this is going to be catastrophic for Britain. Scotland has voted for a ‘remain’ vote and is feeling it undemocratic for UK to bring it out of EU. There is a possibility of second referendum soon for independence from UK. This outcome will be there for everybody to see, including the populist separatist movements against EU, building up in other EU member states. Looking at these adverse consequences for UK after exit, there is a strong possibility of such forces lowering their voices, at least for some time. Meanwhile, EU chiefs have realized that EU citizens on the street are not against the idea of EU, it is only that they want another kind of EU. What is this kind of EU, would be found sooner than one thinks and this would be necessary for the survival EU and to move forward to become a more sustainable economic union.

Contrary to popular view, Brexit is likely to bring Germany and France closer, after Germany has lost its most closer trade ally. Germany will be forced to look at trade relations with other EU members more closely. US is likely to extend the special relationship to EU without UK, the relationship which it traditionally had with UK. It will be in the interest of US to negotiate business and other ties with a larger block in Europe than a small fragmented economically weaker UK.

Finally, it is up to Brussels to find its new avatar as soon as possible and to not only make it expensive for other members to leave but cheaper for then to remain in EU. For example, EU can run its affairs by opening associate memberships to many other outsider states and earning some extra money from such memberships.

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