What is the Impact of Brexit on the World Economy?

Brexit is the name given to the decision taken by the UK to leave the EU because of several reasons. It has created understandable political and economic unrest. After decades of membership, Brexit has gained global attention. It was because of the phenomena of globalization which shows that countries are connected due to the trade system. UK leaving EU is not just going to influence UK and EU but it is going to impact the other countries as well, both economically and politically. For example, foreign investments or businesses operating in the UK are going to get impacted because of the changing tax regulations, exchange rates and trade rules. Additionally, to shift investments out of the UK, firms will also start to relocate jobs and employment opportunities. In the past, Britain and other countries had the privilege to “small open economies” that could influence their domestic advantages through efficient links with Europe and the rest of the world. But after Brexit, being a large and relatively closed economy, it seems like the trade relations of the UK with the world are going to change drastically. Brexit has brought important examples for the rest of the world and about the global economy. The days are gone when accelerating economic and financial globalization were correlated to growing economic growth.

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