Chances are, you are an American who has heard about the UK’s recent decision to sever its ties with the European Union. You’re probably watching everyone going nuts on social media and losing their minds, taking the opportunity to give completely unqualified opinions that they are in no way entitled to promote to the general public. Heck, you might have even done this yourself! Nothing like poking some fun at our old boss, England, right? If this description fits you in any way, shape, or form, I encourage you to take this opportunity to educate yourself about one of the most serious economic and political decisions of the decade.

Britain

Also known as Great Britain, this is a group of sovereign states that consists of England, Scotland, and Wales. Great Britain is situated inside of a region commonly known as the United Kingdom, or UK, which also includes Northern Ireland as part of its territory. The results of June 23rd’s groundbreaking vote showed that, within the UK, both England and Wales voted to leave, while Northern Ireland and Scotland voted that they preferred to remain a part of the European Union.

Referendum

A referendum is a general vote given by an electorate over a single political issue that calls for a direct decision. Everyone within voting age may take part in a referendum. The votes showed that the UK preferred to leave, with the final tally of the “leave” vote being about 52 percent against the “stay” vote, which was about 48 percent. As evident by the numbers (52-48 is pretty darn close to an even split), people are pretty split on the issue. Those who voted to leave cited hopes for increased British sovereignty without being weighed down by the EU, dissatisfaction with EU migration policies, and an overabundance of economic regulations, especially regarding trade. They see their decision to vote “leave” as “taking back control” of their country. On the other side, the “stay” voters had hoped to remain in the EU because they believed leaving would be cutting ties with the huge market the EU engages. They also believe leaving the EU signifies leaving behind a system of cooperation in security, travel, environmental protection, and rights of workers.

European Union

The European Union is a political union and economic partnership of different countries that was created after the disaster that was World War II left Europe in shambles. It was officially established in 1993 with the signing of the Maastricht Treaty and currently has a population of roughly 508 million inhabitants. The initiation of the EU was seen as a way to bring Europe together to rebuild, unite, and move forward together by eliminating the different currencies and helping promote economic growth and trade among its member countries. Currently, there are 28 countries that comprise the EU: Austria, Belgium, Bulgaria, Croatia, Cyprus, the Czech Republic, Denmark, Estonia, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Poland, Portugal, Romania, Slovakia, Slovenia, Spain, Sweden and the UK. When the legislation is completed, the UK will no longer be on this list. The EU has its own currency: the euro. However, the euro is only used by a select 19 EU member countries. This monetary union is known as the Eurozone. The Eurozone countries are as follows: Austria, Belgium, Cyprus, Estonia, Finland, France, Germany, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Netherlands, Portugal, Slovakia, Slovenia, and Spain. Not every country in the European Union or in Europe uses the euro as its national currency.

X-ports

Global Counsel reported this year that the UK accounts for one-tenth of EU exports, while roughly 50 percent of the UK’s exports are to the EU. This trade imbalance means that the EU demands products from the UK, which could be a vital step in the UK’s recovery process. Another bright spot for the UK’s recovery process: it is the largest recipient of foreign direct investment in the European Union. As negotiations continue, consumers should keep a close eye on exports going out of and coming into the UK.

International Influence

Leaving the EU would undoubtedly decrease the power of the UK, but one must bear in mind that their influence in EU decisions (voting power in the European Parliament) has been rapidly decreasing the past five years. So many questions have yet to be answered in this situation. The questions will remain without answers until the negotiation of Article 50 of the Treaty of Lisbon, the treaty that amended some issues within the Maastricht Treaty to make it more stable. Article 50 is the part of the legislation that permits a member state to leave the EU, so long as the state notifies the EU of its intention, negotiates a deal on the terms of its withdrawal, and establishes legal grounds for a future relationship with the EU. As we are still in the early stages of the negotiation processes, close attention must be paid to the media in order to find out details as they are released.

Travel

What does this mean for traveling? Passports from the UK will no longer state “EU” on the front cover. There will likely be a new design revealed in the coming months for UK passports. This process will take as long as it takes the governments to negotiate the complex terms and conditions of Article 50. Regarding future travel, right now no one knows what the negotiations will reveal. There is a chance that the UK will decide to continue the free movement of EU members in and out of the country, as is currently allowed, but perhaps with a few additional regulations or changes. Looking to travel right now? The depreciation of the British pound against the US dollar makes the present time to go across the pond, take advantage of the currency market fluctuations, and get the most out of your money.