Is the UK Better off in the European Union?
The UK has something of a tumultuous relationship with the European Union; most Brits either love it or loathe it. With the rise of the Euro sceptic UK Independence Party (UKIP) and an outpouring of anger from UK taxpayers by the shock demand by the European Commission for the UK to pay an extra €1.7 billion by December 1st we at Future Currency Forecast look at both the benefits and downsides of EU membership. In part one; we focus on the plus points of EU membership.
The Benefits of the Euro (EUR) Exchange Rate
There is little likelihood of the UK adopting the Euro anytime soon as unlike the currencies of a number of European countries, the Pound Sterling (GBP) is still one of the most traded currencies in the world. The Pound comes in fourth behind the US Dollar (USD), Euro (EUR) and Japanese Yen (JPY).
The Euro has been blamed for much of the economic troubles plaguing Europe but without it, it is likely that many smaller European nations would have suffered a lot worse during the global economic crisis. The Euro is regarded as a stable currency as it tends to experience smaller gains and losses than other currencies.
Economic Benefits of UK EU Membership
With all of the doom and gloom being written in the media about the Eurozone, it may be hard to see what benefits are offered by being a member of the European Union. Despite all of the news that the EU economy is faltering, the fact remains that the UK is a member of the world’s largest trading bloc.
The combination of the EU member states economies makes the overall EU economy larger than that of Japan and the United States combined with a Gross Domestic Product (GDP) of around £11 trillion. By being a member, UK businesses benefit from the absence of customs duties and tariffs upon their goods and with only one set of rules to abide by they do not have to deal with many different sets of regulations and rules.
It is true that the European Union is struggling economically and that UK trade with the USA and other nations outside of the bloc has increased but when (if) the situation in the EU improves, the UK will likely see the benefits in trade and prosperity.
Freedom of Movement, Ease of Euro (EUR) Foreign Exchange
The controversial free movement of peoples offered by EU membership is good for business as it allows them to hire skilled workers from across Europe without the hassle of regulations. The UK has benefitted from this by hiring staff from other nations to fill positions where skilled UK workers are in short supply.
Freedom of movement is also good for tourists as it allows holidaymakers to travel throughout Europe without the need for border checks. The Eurozone in particular adds to the benefits of free movement, as you no longer have to exchange money into potentially 18 different currencies. Instead of needing Francs, Pesetas or Lira you just need the Euro.
Global Influence of the EU
Pro Europeans in the UK say that by being a member of the EU the UK has a louder voice on the world stage. The logic is sound that a group of nations working together has more strength than a single nation standing alone.
Working together the EU can tackle issues such as geopolitical conflicts, the threat posed by the spread of diseases and many other issues influencing the international stage. With huge nations like China and Russia to contend with many Europeans, believe that by grouping together under the banner of the EU, member countries can hold their own on the world stage.
Security
The world is experiencing a period of turmoil and with the rise of Islamic State in the Middle East, the conflict in Ukraine and the threat posed by the Ebola virus pro Europeans say that by being a part of the EU we have a better chance of tackling the dangers. The EU also helps promote peace between its members. Prior to the creation of NATO and the EU, the peoples of Europe had been devastated by World War Two, by promoting trade and cooperation there has not been an armed conflict between western European nations since 1945. Pro Europeans hail the EU as the main reason why the continent has been spared the ravages of war for over 70 years.
Should the UK stay in the European Union?
These are some of the major benefits for the UK staying in the European Union but calls are growing louder and louder for the UK to leave. In the second part of this feature, Future Currency Forecast will look at the opposing side of the argument, would the UK be better off outside the EU?
