REPORT
By Gökhan Kurtaran
London letter, week beginning August 29

Will the U.K.’s draft plan to leave the EU be similar to “waiting for Godot”?

It has been nearly two months since the U.K. voted to leave the European Union and not necessarily all were aware of the long-term consequences of the decision. But following former Prime Minister David Cameron’s risky decision, the result of the democratic vote left no other option but for the ruling Conservative Party to form a new cabinet under the leadership of Theresa May.  

As May’s summer vacation in Switzerland comes to an end, her draft plan on how to leave the EU and how to establish sustainable trade deals with the European Union will be the focus of attention.  She so far has declared that a “Brexit means Brexit” and that Article 50, which needs to be invoked to formally leave the EU, would not be triggered before December. Even so, there is not much time left until December and May will need to put her house in order and come up with a legitimate plan other than putting strong Brexit supporters - Foreign Minister Boris Johnson and Brexit Minister David Davis at the forefront of negotiations. The new leader could face increasing socio economic unrest among the public, especially low income families.

The markets are concerned that waiting for the U.K.’s draft plan might turn out to be similar to “Waiting for Godot,” - a play by Samuel Beckett, in which two characters, Vladimir and Estragon, wait endlessly and in vain for the arrival of someone named Godot.

Investment data positive

Nevertheless, despite these concerns, a record number of investments were made by foreign firms in the U.K. in the year to April 2016, according to government figures. The Department for International Trade recorded 2,213 inward investment projects, up 11 percent on the previous year.

Data shows the U.K. is the most popular destination in the European Union for overseas firms. However, there is concern over how the U.K.'s vote to leave the EU may affect future investment decisions.

Young Brit’s apathy and debts

More than a third of young people have debts of almost £3,000 and experience significant concerns about money, according to a recent survey conducted for the Money Advice Trust by YouGov. Young people’s borrowing using credit cards, overdraft facilities and loans from family and friends continues.

Just over half said they regularly worry about money, with 32 percent feeling their debts were a "heavy burden". Women were much more likely to worry about money than men, the survey found. The average debt of £2,989 excludes student loans and mortgages. The average student loan is £25,505.

However, according to official data, estimates show that only 36 percent of people in the 18 – 24 years-old category voted in the EU referendum while 64 percent of young people did not cast their ballots. This data reveals an apolitical approach is common among young Brits despite the mounting burden of student loans and debt on their shoulders. It is questionable as to whether an early general election would change this scenario.

It seems that young Brits are shying away from having a say for their future, and despite their debt problems, they do not consider that they will find a solution to these problems politically.

The markets expect when the new cabinet meets, the formation of a concrete draft plan will give the U.K. some direction and will assure the markets and investors that they will not be needlessly “Waiting for Godot.”

31 Aug,2016

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