Less than a week after Great Britain’s historic vote to leave the European Union, there are varying opinions about how deep the globe –shifting echo caused by the vote will resonate within the United States’ principal European ally, the U.S. itself and throughout Europe.
Councilman Gorän Eriksson was in his native Sweden over the weekend when the Brexit vote happened and like many of his fellow Swedes he was shocked by the close decision to exit the union.
“Most Swedes, like others in the European Union, expected Britain to say,” Eriksson said.
Less than 24 hours after the announcement of the United Kingdom’s “independence vote,” as many of their supporters are calling it, international financial markets tumbled but regained some strength a few days later.
Eriksson, who owns esi Techtrans, Inc., an international development company, does business in Europe and is concerned how Brexit will affect international commerce. “There’s going to be a lot of uncertainty, especially with the currency fluctuation that we’ve already seen. And that’s never good,” he said.
Financial analyst Allen Wisniewski said the split from the European Union will stake a while— European political leaders say at least two years— before England can stand alone again so it may be too early to accurately predict the global financial ramifications of Brexit. “From a U.S. standpoint it shouldn’t be that big of an event, as it is mainly a European issue. To the extent that U.S. companies have significant business dealings in Europe there could be some impact,” he said. “It is too early to see how things will work out.”
On a personal level, Eriksson thinks England should have stayed in the European Union. “Sweden does a lot of trading with England, and I think we’re going to see free trade affected by this vote. I also think the Scandinavian countries will be a little less powerful now,” Eriksson predicted. “But it’s going to take two years before they leave, so there’s a lot of uncertainty.”
While he thinks it might be too soon after the news of England’s exist to discern what might happen to financial markets long-term, Wisniewski, a Culver City resident, agrees with Eriksson on one thing: there will continue to be a great deal of unknown factors about global the impact of Brexit, now and in the future.
“The main risk is that it could cause less global trade, which would be a negative for consumers. It is too early to see how things will work out, but it is creating uncertainty, which financial markets do not like,” he said.
Gary Walker contributed to this story.