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ªÀµûÂù»y¹D¡GHK must caution social schism such as Brexit caused ­É­^²æ¼Ú«e¨®¤§Å² ´ä¶·Äµ±§ªÀ·|¤À¤Æ

2016-07-11
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¡½Jeffrey Tse [ywc_jeffrey@hotmail.com]

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Leave surprisingly won by a 4% margin as Britain's EU referendum drew close. The local financial market, along with the world markets, was in a complete shock after the results came out. While its long-term consequences are yet to surface, Brexit might very much set off a political and economic chain-reaction on a global scale.

Hong Kong must learn the lesson from Britain's EU referendum by being alert of radicals who attempt to politicize local issues and divide the society.

Global economy shaken

World markets were in chaos immediately after results of the referendum were out. British pound sterling slumped against the dollar while the UK's FTSE 100, German DAX and French CAC 40 fell for nearly 10%. Meanwhile in Asia, the Japanese NIKKEI 225 also plunged 8% whereas the local Hang Seng Index fell over 1,200 points at one stage. Central banks of UK, Japan and Switzerland have pledged to take measures to counter a possible liquidity crisis, while rumors are swirling that South Korea, India, Denmark and Singapore are planning to bring in stimulus packages to counter potential market volatility.

By voting to leave, the UK has virtually given up EU's 500 million strong consumer market. While short-term impacts on UK's economy are widely expected, some believe this is only the beginning of the nightmare.

First, the political future of the UK is now clouded by uncertainty as PM David Cameron announced his resignation shortly after the Brexit vote. Meanwhile, despite the fact that the Leave campaign won more than half of the votes, the majority in both Scotland and Northern Ireland voted to remain, which might trigger new referendums in the two constituent units of the UK to break away from the kingdom.

If Scotland and North Ireland do break away, the sun will definitely be setting on what is already the remnant of the British Empire. The second horror that lies ahead is a Brexit domino effect, where EU members like the Netherlands, Sweden and the Czech Republic might seek to follow suit.

British MP murdered by extremist

Uncertainty in the political future of the UK and the EU is set to spur global market volatility. Hedge fund legend George Soros had claimed before the vote that "the pound would fall by... possibly more than 20%", and there will be "an income loss of ¢G3,000 to ¢G5,000 annually per household", therefore "immediate financial consequences" would hit markets around the world. While the weak economies within the EU still have a long way to recovery, Brexit is certainly a devastating blow to both the UK and the EU.

The EU referendum's impact on Britain would not be one-off. Its social implications has been in the form of a divided society and sharp political polarization; a pro-Remain female MP¡]member of parliament¡^has already been murdered by a Leave extremist.

In this sense, Hong Kong is now in a situation very similar to the UK. As a divided society would only halt progression, the people of Hong Kong should think twice lest Hong Kong's promising future should hang in the balance.

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