Influences of Brexit on Korea

 As you know, recently there has been a piece of huge news, 'Brexit' which will be remembered as one of the biggest topics of the 21th century. Ironically, Winston Churchill advocated for 'One Europe', but the descendants have decided to exit from the concept 43 years after the EU was formed. 

Today, I would like to introduce influences which will be caused by 'Brexit' on my country, Korea. Before getting into the topic, I want to let you know one interesting thing. After the referendum which asked British if they want to exit from EU, the most frequently searched Google keywords were 'What is the EU?' and 'What will happen after Brexit?'. The vote rate reached nearly 80 percent, but this fact shows a lot of the British didn't have enough understanding of Brexit.

 

 After British government announced the result of the referendum, stock price indexes of major countries such as the USA, China and Japan have plunged. In addition, OECD predicts that the Britain's gross productivity will decrease by 3.3% by 2020, and in the same period, EU's will decrease by 0.9%, as well. Negative predictions are mainly streaming, but a variety of different opinions are still present among economists all around the world.

 According to financial experts in Korea, the total amount of international trade being accounted for by Britain is just 3 percent, so due to this fact, the experts are predicting direct side effects caused by Brexit will be not so big. In addition, Japanese enterprises which Korean companies' big competitors that produces goods such as cars, TVs and mobile phones will suffer from the rise in the Yen's value, so some people are saying that Korean companies could get 'Reflect Effect' from that.

 However, the main risk is elsewhere. If Brexit causes Global economic depression, all parts of Korea which dependent on export will also get depressed, and it directly will lead to make very slow progress. For example, these days Korean ship making companies are in dire straits. Most ship making companies have been laying off to employees and rebuilding their business structures. These kinds of situation like Brexit has a possibility to lead to decrease in ship trading, then it can make the situation worse. Moreover, in Korea, British funds that are invested are estimated at about 3 billion dollars. If the situation gets worse, the funds could return to the Britain. Not just these things, but also apparently, it will take at least two years to Brexit. Over the next 2 years, the uncertainty would contract consumption trends.

 Nobody knows what will happen exactly, but we know that Brexit is historically important news. If we prepare thoroughly and cooperate with other countries, we can work out of the situation. Lastly, according to Angela Merkel, EU is smart enough to get over the situation even if Britain chooses to exit. I hope that my country minimizes the damage, and in this process of getting over it, becomes a global leader.