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A Study on the Possible Results of Brexit and its Significance: Focusing on the Korean Economy

  • Journal of Asia-Pacific Studies
  • Abbr : JAPS
  • 2019, 26(3), pp.133-164
  • DOI : 10.18107/japs.2019.26.3.005
  • Publisher : Institute of Global Affairs
  • Research Area : Social Science > Social Science in general
  • Received : August 21, 2019
  • Accepted : September 11, 2019
  • Published : September 30, 2019

Shin Sang Hyup 1

1경희대학교

Accredited

ABSTRACT

The U.K decided its leave from EU through the national referendum on June 23, 2016. The two-year negotiation for Brexit officially started with the U.K's notice on Brexit to EU on March 29, 2017. Unlike the expectation on the progress of the negotiation, the negotiation has not been very successful. It is rather in trouble mainly because of the different thoughts of British politicians on Brexit itself. There are three possible types of future trade relations between the U.K and EU: 1) through successful Brexit negotiation, 2) through ‘No deal Brexit’, which means the U.K leave from EU without any decisions on the future trade relations between the two, and 3) U.K’s Cancelation of Brexit. Among these, the possibility of ‘No deal Brexit’ is increasing. If ‘No deal Brexit’ happens, in particular, finance, trade and investment sectors in Korean economy could get some negative influence from it. Thus the Korean government should make efforts to minimize the possible negative influence from it. ‘No deal Brexit’ means that Korea will not be able to enjoy preferential status as a member country of the Korea-EU FTA. To avoid the situation, firstly the Korean government has made efforts to sign a FTA with the U.K before ‘No deal Brexit’ happens. To finalize this effort the Korean government should take measures to get the approval for the FTA from the Korean Parliament before October 31, 2019. Secondly, the Korean government should take measures to minimize the negative influence, in particular, the short term influence, on the financial sector. ‘No deal Brexit’ will increase the uncertainty in the global financial and foreign exchange markets on the short term basis.

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