A reduction in immigration to the UK, one of the key reasons why Britons voted to leave the European Union on June 23, is not going to happen despite the outcome of the vote.
This is because Britain is yet to negotiate the terms of the Brexit, and needs a unanimous vote from all 28 EU members on any of its demands.
It is highly unlikely that they will agree to Britain shirking off the Freedom of Movement Act.
The country needs to keep some of the most lucrative elements of being in the EU’s Single Market in order to stop the economy from diving.
But firstly, let’s look at immigration.
Freedom of Movement Act rules only apply to EU citizens — not asylum seekers, expats or economic migrants. This allows all EU citizens to easily migrate to any other member state.
Official UK government data shows that net migration into Britain from the EU was 180,000 from June 2014 to June 2015 — a new all-time high. The study said that out of the 3.2 million non-UK nationals working in Britain, 2.2 million are EU nationals.
As I detailed before, EU migrants are the lifeblood in Britain’s dominant GDP driver — the service economy. The government would cut its nose to spite its face if it decided to abandon it. In turn, EU members states are highly unlikely to say yes to Britain to withdrawing from the Freedom of Movement Act and even if they said yes, it is unlikely they will let Britain continue enjoying the perks of being part of the Single Market, like unified tax rates on imports and exports.
Take a look at this chart from the Bank of America Merrill Lynch which shows how key EU countries would only agree to Britain being part of the Single Market if the UK kept the Freedom of Movement Act:
So, Britain cutting itself off from the Freedom of Movement Act is pretty much a deal killer if it plans to keep some of the trade conditions it has with the EU. As I detailed before, this is major deal for Britain’s economy.
BAML says in its latest note:
“Further problems stem from the seeming few incentives that EU leaders have to avoid granting the UK a bespoke deal on access to the single market (i.e. not enforcing the choice implied by the trade-off we noted above).
“The reasons are twofold. First, European leaders have highlighted the risk that other countries may want to follow the UK if it is seen to get a good deal. Second, electorates in other EU states seemingly hold different opinions from their UK counterparts about the sort of exit deal the UK should get. A future trade deal between the UK and EU may need to be ratified by parliaments in other EU states.”
Meanwhile, even if new prime minister Theresa May decided to be stricter on border controls for non-EU migrants, her track record is not that great. She was the home secretary for six years and failed to meet the government’s own target of slashing immigration — contributing to why Britons voted for a Brexit.
May was also a staunch Remain campaigner. Couple this with the fact that she is now the leader of the country and in charge of navigating how Britain divorces the EU, all signals point towards it being highly unlikely that an immigration reduction will happen any time soon.
Business Insider Emails & Alerts
Site highlights each day to your inbox.