“Brexit is a time bomb,” UBS Chairman Axel Weber told the International Institute of Finance’s spring meeting in Tokyo, Japan, on Monday.
His comments, reported by the Financial Times, were in relations to the biggest political risks in Europe. He not only talked about Britain leaving the European Union on March 29, 2019, but also said Emmanuel Macron’s landslide victory in the French presidential election “does not mean Europe is out of the woods.”
“Brexit is a time bomb… and the countdown is on. It will be two years from now… if the British really do leave the customs union and single market there could be a lot of volatility which could impact on the global economy,” Weber said according to the FT.
He added that political risk is still “actually quite high” and said Italy also poses a risk to Europe’s stability.
“There is still Italy where it is very unclear that the centre will hold. And there is still Greece. Where you find some bright side… there are (also) some downside risks that are not really priced into the market but could derail (Europe),” he said.
Emmanuel Macron won the French presidential election in a landslide on Sunday, becoming the youngest president in France’s history. Macron, a 39-year-old pro-business centrist, defeated Marine Le Pen, a far-right nationalist who called for France to exit the European Union, by a margin of 66.06% to 33.94%.
The election of Macron was seen as a rejection of the far-right in France but populism is growing around the world, as illustrated by Brits voting for Brexit last year. Prime Minister Theresa May is pushing for a “hard Brexit” — Britain leaving the EU’s Single Market in exchange for total control of immigration.
Meanwhile, the US elected Donald Trump as President last year. He is proposing populist trade measures and policies related to immigration.