How does Brexit affect Malaysia?
By Zan Azlee
So Brexit has happened. Can you actually believe that a majority of Brits decided to vote in a referendum for leaving the European Union (EU)?
The immediate effects on Britain are already obvious. The Pound dropped to a historical low. Foreign investors are pondering the situation. David Cameron will resign as Prime Minister.
The effects on Europe are going to be huge too. Many see it as a ‘Berlin Wall’ kind of event that could trigger insecurity in the EU.
But what about Malaysia? So many people I have met and spoken to have indicated apathy saying that it has no direct effect to our country. But is this true?
Like it or not, there are many similarities between Britain and Malaysia. Just look at how the voting demographics are like during the referendum.
The large urban areas such as London, Liverpool, Manchester and Leeds had voted to remain in the EU while the rural areas mainly voted to leave.
The statistics show a clear distinction in the vote based on attitudes, age, income and education level. The older, lower educated and lower income group voted to leave.
The progressives and more exposed group voted to remain because there clearly saw and understood the advantages of remaining in a larger European community.
I do not hide the fact that I think it is better for Britain to remain in the EU just because it is more socially just for the entire people in the long run.
I don’t have to explain much when it comes to comparing the similarities with Malaysia. All I need to do is to prompt you to recall how the voting went during our last general election.
But yes, let’s get on with how the Brexit will effect Malaysia.
Firstly, because of our Commonwealth ties, trade and investment happens much easier. In fact, many investors in Malaysia use Britain as a stepping stone in to Europe.
When Britain leaves the EU, what will happen to trade and investment? There would need to be fresh negotiations and basically, starting from scratch all over again.
Secondly, Britain is one of the countries where a significant bulk of Malaysian students are sent for tertiary education. How will the quality fate once EU research and educational benefits stop?
And let’s not talk about the cost. Many people think that because the Pound is now worth much less, it would be an advantage for us because cost would be low.
Well, why don’t you just do a quick check on XE.com and see how the exchange rate between the Ringgit and the Pound is doing at the moment?
Surprise to see that the rate between the two currencies are almost still the same even before the Brexit happened? I’m sure you are.
The Pound is dropping in value compared to the US Dollar. The Ringgit is dropping alongside the Pound. So that’s why there isn’t much difference in the exchange rate.
Then there is a matter of immigration. I believe in free movement of people and that it should be a basic human right. Obviously, those who vote to leave the EU don’t think so.
If they aren’t willing to open their borders to the rest of the European community, what more when it comes to the rest of the world? And remember the Schengen Agreement? Gone!
So how? Do you really think that Brexit doesn’t affect us here in this part of the world?