Reflection on Brexit: Five Years After the Split

LONDON — Five years ago today, two contrasting groups congregated near the UK Parliament, expressing their views on the nation’s pivotal moment. One side waved the Union Jack, exuding joy and confidence, while the other held EU flags, displaying sadness and disappointment.

On January 31, 2020, at 11 p.m. in London—midnight at the EU’s Brussels headquarters—the United Kingdom ceremoniously exited the European Union after nearly five decades of membership. This period had facilitated free movement and trade among 27 EU countries. Supporters of Brexit heralded the moment as a return to sovereignty, believing the UK was once again in control of its own future. In contrast, critics perceived it as a step towards isolation and diminished stature.

The UK, undeniably fractured by this decision, embarked on a journey full of uncertainties. Half a decade later, both individuals and businesses continue to grapple with the economic, social, and cultural reverberations of Brexit. Political scientist Anand Menon, director of the think tank UK in a Changing Europe, remarked on the remarkable impact this change has had, noting that it has substantially reshaped both the economy and the political landscape, turning Brexit into a central narrative in electoral politics.

The decision for the UK to leave was solidified during a referendum conducted in June 2016, where the country voted 52% in favor of leaving the EU compared to 48% who wanted to remain. This outcome took many by surprise, including members of the Conservative Party, who were advocating for continued EU membership. The years that followed were marked by intense negotiations between a resentful EU and a fragmented UK, leading to significant delays in reaching a consensus on Brexit’s terms. This deadlock ultimately contributed to the resignation of Prime Minister Theresa May in 2019, who was succeeded by Boris Johnson, who pledged to finalize the split.

However, the departure turned out to be more complicated than initially anticipated. The UK exited the EU without a clear agreement regarding future trade relations, which is vital as the EU represented a significant portion of UK trade. Following nearly a year of difficult discussions, an agreement was finally reached on Christmas Eve 2020, but it was minimal, resulting in the UK leaving the EU’s single market and customs union. While this arrangement allowed goods to move without tariffs or quotas, it also introduced new bureaucratic obstacles, increasing costs and causing delays for businesses engaged in trade.

Lars Andersen, who operates a labels business named My Nametags based in London, shared his experiences post-Brexit. He mentioned that although it has become more expensive and slower to conduct business, his company has adapted by establishing a base in Ireland, through which EU-bound orders must now transit. While he has navigated these changes, some of his colleagues in the small business sector have ceased trading with the EU or relocated their manufacturing overseas.

Julianne Ponan, the CEO of Creative Nature, an allergen-free food producer, faced challenges as her previously thriving exports to EU countries suffered as a result of Brexit. However, she has successfully pivoted to markets in Australia and the Middle East, viewing this shift as a silver lining. Despite her efforts to rebuild her European market presence, she expressed regret over the lost growth opportunities that Brexit has incurred.

The Office for Budget Responsibility has predicted long-term declines of about 15% in both UK exports and imports as a result of leaving the EU, alongside an expected 4% drop in overall economic productivity. Proponents of Brexit claim that this short-term hardship will eventually give way to newfound freedoms in global trade, pointing to recent agreements with countries such as Australia and Canada.

Yet, trade expert David Henig expressed skepticism regarding the utility of these agreements in compensating for lost trade with neighbouring countries. He noted that while the UK still exports significant goods, such as defense products and whisky, medium-sized companies particularly feel the strain of maintaining their export capabilities, facing difficulties in attracting new business investments.

Furthermore, Brexit has produced unintended consequences that diverged from both sides’ expectations. The COVID-19 pandemic and the geopolitical upheaval resulting from Russia’s invasion of Ukraine have compounded economic troubles, making it increasingly difficult to discern the precise effects of leaving the EU. The surge in post-Brexit immigration also runs counter to the voting sentiment that prompted the departure, as the UK has seen an influx of skilled workers through newly issued visas.

In the current political climate, characterized by rising populism, the UK seems to be reassessing its global relationships, caught between its longstanding ties to Europe and its “special relationship” with the United States. Menon pointed out the heightened challenges the UK now faces in this less forgiving global environment.

Recent polls indicate a shift in public sentiment, with many UK citizens believing Brexit was a mistake. However, the prospect of rejoining the EU appears distant, as the painful memories of past divisions remain vivid in the public consciousness. Keir Starmer, the newly elected Prime Minister from the Labour Party, has expressed a desire to mend the relationship with the EU, though he has ruled out rejoining the customs union or single market. His plans include facilitating artistic tours and easing the process for professional qualifications, along with pursuing enhanced collaboration on security and law enforcement.

While EU leaders have noted a positive change in the tone from the UK, they, too, face their own challenges amid a rise in populism across Europe. As such, the UK is no longer the foremost focus of their attention. Nevertheless, Andersen remains optimistic about the future, suggesting that gradual reconciliation between the UK and EU is possible, although it may unfold quietly over time, without dramatic political fanfare.