On 23 June 2016, in a British referendum, a majority 52% of British citizens voted to leave the European Union of 28 States (known as Brexit) to which it belonged since its creation in 1993.
The procedures have already begun and although this is going to take some time (since it is estimated that this will take place in March 2019), it is a fact that everyone is analyzing and theorizing about what could possibly happen and how it can affect us.
Richard Branson, one of Britain’s most successful entrepreneurs, said he’ll cut the investments in the United Kingdom by his Virgin Group of companies if the government pushes ahead with its plan to leave the European Union. Highlighting his frustration at Brexit, the iconic billionaire said investing in a country that was harming itself “doesn’t make sense”.
Here, we examine five possible outcomes once Brexit fully takes place.
1. Increase of airfares
With the influx of budget airlines and competitive airfares, flying to the UK from all over Europe has become so much easier. The departure of the UK will likely generate new conditions as new negotiations can lead to an increase in tariffs.
Currently, there is an agreement called “Open Skies” which allows more airlines, more routes and lower fares between EU member states. That is a common airspace that gives airlines the freedom to fly across Europe. Thanks to this agreement, rates were reduced by 40 percent and routes increased by 180 percent. With Brexit, these benefits might disappear, and they are likely to. Everything will depend on the negotiations that will take place during the next two years for the departure of the UK from the Union.
2. Decrease in supply of services
According to a report by the Association of British Travel Agents, around 70 percent of workers in the tourism industry in London, are immigrants. One of the main ideas of supporters leaving the EU is to reform immigration policies and curb the number of arrivals to the UK. This reformative action can lead to a cut in staff in the travel and tourism industry with an estimation of 63,000 jobs lost that would affect the normal provision of tourism services for a good time.
3. Change in price of pound
As soon as the results of the referendum were announced, the pound took a sharp fall, dropping as much as 18 percent of its original value before Brexit. This for the British is a negative thing because it reduces their buying power with respect to the international markets. However, it is a good thing for travelers to the UK, as it is now one of the most favorable markets in the world for luxury goods. This is based on the fact that foreigners spent 161 million Dollars more in December 2016 than in December of the year 2015.
4. Decline of international tourists
London is one of the most popular cities that attract tourists from all over the world, as well as other smaller regions of Northern Ireland and Scotland, which are sought after by travelers for their picturesque, native villages. According to a survey conducted before the referendum, there was a negative trend in the interest in traveling to the UK and with Brexit, it is feared that this trend may decline even more in the next two years.
It is true that episodes of political and economic uncertainty often lead to temporary decreases in tourist flows: A third of German, Italian and Spanish tourists, and a quarter of French tourists said they would be less inclined to travel to the UK should they gain the option of leaving the European Union and 10 percent of travelers from Canada and 12 percent from the United States also said the same thing.
5. Change in migration policies
At the moment, it is uncertain on whether there will be any change in migration policies. In the next two years of the Brexit negotiations, many border changes are not expected. However, by March 2019 this could be altered and travelers can see changes in the conditions of entry to the UK countries with respect to those they currently have under EU Conventions.
In short, now is a good time to plan a trip to the UK due to the drop in the price of the pound, which represents better prices for foreign tourists and also of the fact that until now no migration issues or air fares have been modified, which is very likely to happen within two years when the departure from the European Union takes effect.