1. : Causes & Consequences
2016
BS15079
University of Sheffield, CITY
College, An International
Faculty of the University
5/16/2016
: Origins and Implications

2. : Origins and Implications
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Table of Contents
1. Introduction................................................................................ 1
1. Great Britain & the EU Membership....................................... 1
1.1 Early Years............................................................................. 1
1.2 1973 United Kingdom Referendum....................................... 2
1.2.1 Internal Political Situation ............................................... 2
1.3 Present Years.......................................................................... 3
1.4 Renegotiation of Membership Conditions ............................. 4
1.4.1 Internal Political Situation ............................................... 4
1.4.2 External Political Situation .............................................. 5
1.5 Eurozone ................................................................................ 5
2. Consequences.............................................................................. 6
2.1 Legalities................................................................................ 6
2.2 Economic................................................................................ 7
2.3 Political .................................................................................. 8
3. Conclusions ................................................................................. 8
4. References................................................................................... 9

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1. Introduction
The vision of a unified Europe is age-old with historical figures trying to realize the
idea of continental unanimity within the European region, sometimes leading to horrific
aftermaths, such as the World War II (Dinan, 2014, McCormick, 2014, Marshall, 2013,
Pilotto, 2012). Nevertheless, the aforementioned war and the Cold War that ensued,
instigated the creation of the European Union as is nowadays, with British politicians
such as Sir Winston Churchill being at the forefront (Dinan, 2014, McCormick, 2014,
Marshall, 2013, Pilotto, 2012). However, the stilted and detached British standpoint
toward European integration has created longstanding problems, culminating in the
2016 in-out referendum (Oliver, 2015).
1. Great Britain & the EU Membership
1.1 Early Years
Great Britain’s first attempt in European Communities participation was in 1961 when
the Conservative party under Harold Macmillan applied to be enrolled (Marshall, 2013,
Pilotto, 2012, Bulmer and Burch, 2005). Even though the English were founders of the
European Trade Association (EFTA), formed in 1960, it was losing its influence, with
English exports declining to 20% from 49% in previous years (Baimbridge, 2015,
McCormick, 2014, Marshall, 2013, Dinan, 2004). Thus, they turned to the European
Economic Community (EEC) to achieve their full economic potential, while at the same
time avoiding financial seclusion (McCormick, 2014, Marshall, 2013, Dinan, 2004).
Nevertheless, their first and second attempt were not fruitful, mainly due to French
president’s, Charles de Gaulle, beliefs that the British indifference towards adaptation
and integration would not make them adequate participants (McCormick, 2014,
Marshall, 2013, Dinan, 2004).
Consequently, it was not until 1973 that full membership was reached, that, being part
of the EEC first widening undertaking, while also because de Gaulle resigned from his
presidential position (McCormick, 2014, Marshall, 2013, Pilotto, 2012, Bulmer and

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Burch, 2005). Thus, albeit the history of the nation is inextricably linked to Europe and
therefore, the adaptation and integration effort were explanatory, the need for
independence along with the negative proclivity towards supranational governments
displayed by the British, were imperative causes behind the British disengagement
(Marshall, 2013, Pilotto, 2012). That led to the 1975 United Kingdom referendum on
continued EEC membership (Bulmer and Burch, 2005).
1.2 1973 United Kingdom Referendum
Roughly 44 referenda have occurred in the European region to date, incorporating the
votes of non- EU states, such as Switzerland (McCormick, 2014). The 1975 referendum
was built upon the renegotiated stipulations of the 1974 Harold Wilson Labour
administration, and its outcome was pro-EEC (Baimbridge, 2015).
1.2.1 Internal Political Situation
The applicability of the referendum to the whole of UK was a first for the English
(Walsh, 2016). The main question raised was the furtherance of the UK participation in
the EEC, thus, agreeing with the new terms of its association (Baimbridge, 2015).
Nonetheless, this decision held political weight, as the English relationship with Europe
relied on it (Baimbridge, 2015).
Its roots lie firstly, at the insistence of the Wilson government for free trade and their
role globally, over economic and political integration (Mourlon-Druol, 2015).
Secondly, the culpability of the harsh internal economic situation, on the EEC accession
(Mourlon-Druol, 2015). Thirdly, the argument that their budget provision was
disparate, and lastly, the previous governments’ discussions, whose main strategy was
the launch of a “European regional fund”, (p.4) were denounced by the Wilson’s Labour
Party (Mourlon-Druol, 2015).
Consequently, Harold Wilson tried to renegotiate the conditions on the English’ behalf
that led to the ballot (Mourlon-Druol, 2015).

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During this period, Margaret Thatcher, the forerunner of the opposition was a strong
advocate of remaining in the Communities, while, the Labour camp was divided
(Walsh, 2016). Eventually, the outcome was in favour of continuing their membership,
however, that was the first crack in this relationship and it did not solve their disputes
in the long run (Walsh, 2016, Mourlon-Druol, 2015).
1.3 Present Years
Nowadays, the threat, or promise, of the second UK referendum is set to happen on
June 23, 2016, since the desire to renegotiate the terms of accession never died for 40
years (Butler et al, 2016, Taberno and Ciardiello, 2016, Mourlon-Druol, 2015).
This referendum’s causes originate partly, from the frictions observed within the
Conservative Party, probably to improve their negotiating power within EU, but mainly
due to the aforementioned domestic need not to become fully assimilated in the Union,
feeling protective over their cultural beliefs, identity, sovereignty and position in the
world (Butler et al, 2016, Kroll and Leuffen, 2016, Oliver, 2015).
Table 1. The UK demands as set
in the 1974 Labour Party
Manifesto (Moulron-Druol, 2015)

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1.4 Renegotiation of Membership Conditions
These reasons have urged the British to argue in favour of a “multispeed Europe”,
“Europe á la carte” or “variable geometry in Europe” resulting in the 2016 vote (Butler
et al, 2016, p.1).
1.4.1 Internal Political Situation
In 2013 the Conservative Party leader, David Cameron, prime minister at the time,
vowed that he would conduct a voting as concerns the UK’s future in the EU, should
his party be re-elected in 2015 (Butler et al, 2016). Consequently, after the favourable
outcome of the general elections, Cameron announced that he would renegotiate the
EU membership terms before conducting the referendum (Butler et al, 2016).
At that time, the three main parties in the UK had unanimously agreed over this topic,
with the unexpected power of the emergent faction of the Eurosceptic UK
Independence Party (UKIP) urging the Labour and the Liberal Democrats to approve
these steps (Oliver, 2015). Moreover, the inland turmoil of the Scottish vote of
independence along with the threat of the Eurozone crisis and the immigration, further
adhere to the eventual decision to go along with an in-out vote (Oliver, 2015).
Furthermore, even the EU Scottish National Party agreed with this decision, though it
was mainly in the hope of a future referendum for Scottish liberation (Oliver, 2015).
Table 2. Major UK problems and
demands, as stated by PM Cameron’s
letter, in 2015 (Traynor, 2015)

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After the renegotiation process finished, and a new agreement had been reached by the
European Council, the Conservatives still went on with their verdict of a national poll
(Butler et al, 2016).
1.4.2 External Political Situation
Generally, northern EU member states champion the reforms that UK policies pursue,
and vote accordingly, because their positions on common issues correspond, contrary
to the southern states which are less inclined to agree, thus their positive position to
Brexit which will add more power to the Mediterranean bloc (Kroll and Leuffen, 2016,
Oliver, 2015).
Thus, after the announcement of a possible referendum was issued, PM Cameron held
meetings with all the EU associates because its outcome would impact EU greatly,
politically and economically (Kroll and Leuffen, 2016, Oliver, 2015).
1.5 Eurozone
The common market, and afterward the single market, was the motivator behind the
British desire to enter the EU (Sapir and Wolff, 2016, Marshall, 2013). Firstly, this
market comprised of the free transportation of goods, labour, and later of services and
capital (Sapir and Wolff, 2016). However, in the European spirit of integration, in 1991
the Maastricht Treaty was introduced, promoting a unitary monetary system (Sapir and
Wolff, 2016). Shortly in 1997, the British signed the Amsterdam Treaty which
incorporated the Schengen Agreement, thus, agreeing to eliminate physical borders
between allied countries (Sapir and Wolff, 2016).
Since the British were against the “one money, one market” (p.4) scheme they did not
agree and never signed the Maastricht Treaty, thus abdications were issued to them,
Denmark and member states that had not reached their economic conditions yet (Sapir
and Wolff, 2016). However, before the Eurozone crisis in 2010, no issues had arisen
among the non-Euro and Euro countries even if there was imbalance, so after the crisis,
Britain found itself at a disadvantageous spot since their banking interests, in the wider
Single Market, were affected (Sapir and Wolff, 2016). Subsequently, the protection of

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the Single Market was among the major concerns raised by president Cameron in the
reform efforts, thus illustrating the importance and significance of this issue (Sapir and
Wolff, 2016).
2. Consequences
The implications of a positive response to the British exit will cause a shift in the lives
of not only Europeans, but people worldwide, since politics and economics are
symbiotic in today’s globalized society (Jensen and Snaith, 2016, Oliver, 2016). The
Bank of England issued a warning in March 2016 of increased interests rates for
mortgage loaners and businesses, even “a run on sterling” due to the probability of
Brexit (Farrell and Elliot, 2016). Additionally, Allen (2016) and Kollewe (2016),
highlight the dive of buyer confidence in England, since according to a GfK study, UK
customers’ optimism dipped, with the index descending from O, in March to -3, in
April.
Consequently, the suggestion of EU departure has already caused a change in the
English economy and welfare, however, there are arguments of further consequences,
for example, the potential loss of movement and subsidizing to physician researchers
and subsequently to global cooperation in the study of cancer (Taberno and Ciardiello,
2016).
2.1 Legalities
Separating UK and EU is legally complicated and involves operational expenses, even
if the Treaty of Lisbon established Article 50 Treaty on EU, providing autonomy to the
member states on their continued association based on their constitutional requirements
(Butler et al, 2016, Jensen and Snaith, 2016). There is ambiguity on this regard, as there
is no precedent, thereby, the laws applied from EU legislation would need to be
addressed anew domestically while international treaties negotiated afresh (Butler et al,
2016). Lastly, UK-EU after-exit affiliation could be a matter of dispute, as interstate
arguments may occur, as far as what kind of agreement is to be followed, for instance,

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one like Switzerland’s or Iceland’s, which is a member of the European Economic Area
(Butler et al, 2016, Oliver, 2016).
2.2 Economic
The UK is one of the world's driving money related focuses, and EU is its greatest
client, so British fund is obviously threatened by a possible Brexit, even if Euro-sceptics
highlight future lighter controls (Jensen and Snaith, 2016).
In studies by Dhingra et al (2015, 2016), the economic consequences of Brexit are
stressed because UK exports to the EU stand for roughly 15% of national GDP.
Table 3. After-Brexit implications in some areas (Dhingra et al, 2016, Dhingra et al, 2015)
Moreover, British attempts such as the Transatlantic Trade and Investment Partnership
(TTIP) with the USA and Japan would suffer because if England leaves the Union it
will decrease its bargaining power, resulting in a negative outcome for them (Dhingra,
2016, Dhingra, 2015).

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2.3 Political
Politically, a possible Brexit could affect several interest groups, presumably the most
monetarily capable, which would strive to reach a better political position in the
adaptation process after the exit, thus destabilizing the overall parties’ powers in Britain
(Jensen and Snaith, 2016). Besides, the existence of Scotland, Ireland and Wales, semi-
autonomous regions, connotes that the after-exit agreements would need to correspond
with their interests as well, thereby complicating the political agenda, with the probable
threat of Scottish independence impending (Butler et al, 2016). Lastly, even if Brexit
does not occur, the issues between UK-EU relationship would remain unresolved
(Butler et al, 2016).
Simultaneously, in Europe clout would change hands as well, since different member
states would try to further their influence in the absence of this great power (Butler et
al, 2016, Oliver, 2016). Thereby, the EU would endeavour to increase the integration
process by turning to higher monetary unity and German collaboration, in order to
retain its competitive position worldwide (Oliver, 2016). Hence, eliminating the
geopolitical fears of their international affiliates (Oliver, 2016).
3. Conclusions
The UK-EU turbulent relationship has its origins at the beginning of the European
integration process and, unfortunately, no step so far has accomplished in eliminating
their differences, leading to the 2016 in-out ballot. The consequences of this decision
would influence the political, economic and social environment throughout the world
due to globalization, illustrating the weight behind this result.
Maintaining their EU place may bring about political inconvenience, yet, in the event
that the UK leaves the EU, the monetary inconvenience will be twofold (Dhingra,
2015).

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4. References
Allen, K. (2016). Consumer confidence in UK at lowest level in 15 months, survey
suggests. [online] the Guardian. Available from: https://www.theguardian.com
/business/2016/apr/29/uk-consumer-confidence-barometer-eu-referendum-gfk
[Accessed 1st May 2016].
Baimbridge, Mark (ed) (2015). The 1975 Referendum on Europe - Volume 1:
Reflections of the Participants. Exeter, Andrews UK Limited.
Bulmer, Simon and Burch, Martin (2005). The Europeanization of UK Government:
from Quiet Revolution to Explicit Step-Change?. Public Administration, 83(4),
p.861-890.
Butler, Graham et al (2016). ‘Slow change may pull us apart’: debating a British exit
from the European Union. Journal of European Public Policy, pp.1-7.
Dhingra, Swati et al (2016). The consequences of Brexit for UK trade and living
standards. CEP Brexit Analysis, (2), p. 1-10
Dhingra, Swati et al (2015). Should We Stay or Should We Go? The economic
consequences of leaving the EU. CEP Election Analysis Paper, (22), p.2-10.
Dinan, D. (2014). Europe Recast: A History of European Union. 2nd ed. Boulder, CO,
Lynne Rienner Publishers, p.1-20.
Elliott, L. (2016). Brexit fears weighing down UK manufacturing? Dream on. [online]
the Guardian. Available from: http://www.theguardian.com/politics/ 2016/ may
/03/Brexit -fears-uk-manufacturing-eu-referendum-george-osborne [Accessed 1st
May 2016].
Farrell, Sean and Elliott, Larry (2016). Bank of England warns that vote to leave EU
risks a credit crunch. [online] the Guardian. Available from:
https://www.theguardian.com/business/2016/mar/29/bank-of-england-clamps-
down-buy-to-let-lending [Accessed 1st May 2016].

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Jensen, Mads D. and Snaith, Holly (2016). When politics prevails: The political
economy of a Brexit. Journal of European Public Policy, 63(17), p. 1-9
Kollewe, J. (2016). Brexit jitters dent UK consumer confidence, study claims. [online]
the Guardian. Available from: http://www.theguardian.com/politics/2016/mar /31/
Brexit-jitters-uk-consumer-confidence-eu-referendum [Accessed 1st May 2016].
Kroll, Daniela A. and Leuffen, Dirk (2016). Ties that bind, can also strangle: The Brexit
threat and the hardships of reforming the EU. Journal of European Public Policy,
p.1-10.
Marshall, S. (2013). Forty Years On: Britain in the EU. The Round Table, 102(1), p.15-
28.
McCormick, J. (2014). Understanding the European Union: A Concise Introduction.
6th ed. Basingstoke, Palgrave Macmillan.
Mourlon-Druol, E. (2015). The UK’s EU Vote: The 1975 Precedent and Today’s
Negotiations. Bruegel Policy Contribution, (8), p.1-10
Oliver, T. (2016). European and international views of Brexit. Journal of European
Public Policy, p.1-8.
Oliver, T. (2015). Europe's British Question: The UK–EU Relationship in a Changing
Europe and Multipolar World. Global Society, 29(3), p.409-426.
Pilotto, S. (2012). Europe and United Kingdom of Great Britain and Northern Ireland:
a peculiar relationship. Instituto Per Gli Studi di Politica Internationale Analysis,
94, p.1-6.
Sapir, André and Wolff, Guntram B. (2016). One market, two monies: The European
Union and the United Kingdom. Bruegel Policy Brief, (1), p.1-8
Tabernero, Josep and Ciardiello, Fortunato (2016). Brexit: A European
perspective. The Lancet Oncology, 17(5), p.558-559.

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Traynor, I. (2015). David Cameron's EU demands letter explained. [online] the
Guardian. Available from: http://www.theguardian.com/politics/2015/nov/10/
david-camerons-eu-demands-letter-explained [Accessed 1st May 2016].
Walsh, J. (2016). Britain's 1975 Europe referendum: what was it like last time?.
[online] the Guardian. Available from: http://www.theguardian.com/politics/2016/
feb/25/britains-1975-europe-referendum-what-was-it-like-last-time [Accessed 1st
May 2016].