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London - The UK’s impending departure from the European Union means the rest of the bloc is saying goodbye not only to its most awkward member, but also to one of its richest countries, with its biggest defense budget and its most successful financial-services hub.
With Theresa May vowing to trigger Article 50 of the Lisbon Treaty to start two-year exit negotiations in March, here are six charts showing what the EU will lose when the UK eventually walks away.
Britain’s defense spending is the EU’s highest
Defense is still the preserve of national governments, but there’s a reason why some of the EU’s countries closest to Russia fear they are losing a safety net - and why the UK may be able to use its military might to gain some leverage in the Brexit negotiations.
Britain (with France the only EU countries with nuclear weapons) has participated in many EU military operations, particularly in Africa where the EU has run several peace-keeping and training missions. The British government has said cooperation will continue in some form, but the EU acknowledges that it’s losing expertise and clout.
The UK gives the EU a louder voice on the world stage
Despite the EU being a multinational organisation, its countries represent themselves individually in most global bodies. And while there is no guarantee they all sing from the same EU hymn sheet when they meet as part of, say, the Group of Seven, they often try to coordinate positions.
The UK and France are the only two EU countries that are permanent members of the United Nations Security Council.
Britain used EU free-movement rules to welcome foreigners
The ability of EU citizens, no matter where they come from, to live and work in any of the bloc’s member countries underpins one of the EU’s most cherished principles.
It also was one of the main reasons why 17.4 million British voters supported Brexit. With its liberal labour laws, English language and well-performing economy, the UK has been one of the biggest attractions for Europeans seeking to take advantage of the EU’s free-movement rules.
The status of Europeans already in Britain is not yet guaranteed and needs to be settled in negotiations on the UK’s withdrawal. In the longer term, Brexit removes the opportunity for countless EU citizens to move unhindered to one of their favorite countries.
London’s financial hub packs a punch
Financial services will be a key battleground in the Brexit negotiations. The UK accounts for 37% of all global foreign-exchange trading, 39% of the world’s trading in over-the-counter derivatives and is the biggest center for international bank lending, at 17%, according to lobby group TheCityUK.
Now the fight is on to protect the industry after Brexit, either by maintaining “passporting” rights, which allow global banks with bases in London to provide services to the rest of Europe, or, failing that, the less attractive “equivalence,” which gives companies based outside the EU privileged, though targeted, market access.
Brexit means a big hole in the EU’s coffers
Even when taking into account the UK’s “rebate” - the discount obtained by Margaret Thatcher in 1984 that knocks an annual £5bn off the country’s contribution - Britain is still the EU’s second-largest net contributor to the bloc’s budget.
The EU will be down almost $13bn) a year once the UK is gone and, as this chart shows, the countries that were formerly behind the Iron Curtain and that joined the EU most recently will be worst hit. The EU, which will start preparing its 2021 to 2027 budget around the time that Britain departs, needs to work out whether and how it will make up the shortfall.
The EU Is saying goodbye to one of its richest nations
The EU is losing its second-largest economy. The UK’s unemployment rate is higher than only three other EU countries and the Bank of England and the European Commission have revised up their estimates for Britain’s economic expansion, saying the impact of Brexit will be milder this year than previously estimated.
But there might be trouble ahead. At 89% of gross domestic product, the UK has one of the EU’s highest public debt levels, and GDP growth will slow from 2% in 2016 to 1.2% in 2018, according to EU forecasts.
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