The Brexit situation is one of the most talked about issues in Europe right now. The word itself is a portmanteau of “Britain” and “exit,” and has become the accepted shorthand to describe the issue of the United Kingdom leaving the European Union. This decision was made via a nationwide referendum on 23 June, with over 30 million people voting on the issue. Overall, the question was decided with a 52-48 percent vote in favor of leaving the EU.
Brexit and the Economy
Since the referendum, former Prime Minister David Cameron has resigned his post and been replaced by the former home secretary, Theresa May. While Mrs. May was, like Cameron, initially against leaving the EU, she has stated publicly that she will respect the outcome of the referendum. She has summed up her position with one succinct statement: “Brexit means Brexit.”
Right now it is still too soon to tell what long-term effects Brexit may have on the UK’s economy, but so far the country seems to be handling the decision well. The value of the pound has dropped, and Britain has lost its AAA credit rating, but there is still a distinct division of opinion when it comes to the question of what the long-term effects of leaving the EU will be.
Despite the slump in sterling and the lowered credit rating, British stocks are trading well, with some even trading higher than their pre-referendum values. In addition, the Bank of England has cut its interest rates to 0.25 percent, which is a record low, in hopes of stimulating investment and heading off a potential recession.
Brexit’s Effects on the Online Gambling Sector
As with the economy, it is too soon to know for certain the full effects of Brexit in regards to the legal UK online gambling industry. Many UK gaming providers have been bracing themselves for the worst possible outcomes, though so far their fears seem largely unfounded. Others outside of the UK have been monitoring the situation closely, curious to see how UK casinos cope with the shifting economic environment.
One major fear revolves around Gibraltar, one of Europe’s biggest gambling centers. UK online casino providers in worry that Gibraltar will lose its connection to the larger European gambling market, which would be disastrous for them. However, in post-referendum interviews, Gibraltar Gaming Commission’s Phill Brear has remained confident and unruffled.
Brear actually believes that Brexit will not have a major impact on how Gibraltar’s gambling sector functions at all. He is convinced that they will be able to retain their position as one of Europe’s top gambling centers. In one of his statements, he said, “You can be sure that Gibraltar has the agility to make sure its model is adapted should there be a Brexit, to remain as attractive…to the online gambling community, which is surely embedded in Gibraltar.”
The Current State Of Affairs
Despite his confidence, though, at this early stage of the game it is nearly impossible to predict how the situation will work itself out, partly because the UK is scrambling to assemble a proper team of skilled negotiators to handle talks with the EU – something that should have been planned for long before the referendum took place. Until some sort of agreement is drafted and agreed upon, the UK’s general economy, including the gambling industry, may have a somewhat bumpy road over the next two years.
In truth, Gibraltar should not experience too much economic upset regardless of what route the UK takes in future Brexit negotiations. In regards to the gambling industry, Gibraltar does have the option to essentially model its gaming rules and tax regulations after those established by the EU, which would minimize any negative impacts Brexit may have.