The term Brexit is a commonly used for the United Kingdom's planned withdrawal from the European Union.
Following the 2016 referendum vote to leave, the UK government started the withdrawal process on Wednesday, March 29 2017, putting the UK on course to leave by April 2019.
According to Paul Thomas Arkwright and the foreign and commonwealth office, the decision the British people made on 23rd June 2016 to leave the EU was a momentous one. One that will lead to change, and much detail about that change is still uncertain. But there are some very important certainties, which includes what the move will mean for Nigeria and Africa as a whole.
What are the benefits of Brexit to Nigeria?
1. A victory for Democracy
Brexit shows a great deals as to how democracy is to be respected, something Nigerians also understand. The importance of respecting the democratic decision-making process can be likened to the kind of example that President Gooduck Jonathan also gave when he handed power to President Buhari in 2015. He showed then that there could be a peaceful transition of power from one democratically elected civilian President to another in Nigeria. So following the BREXIT vote, it was a very powerful signal of democracy to the world that the then British Prime Minister did not dispute the outcome, accepted it and resigned his office to allow new leadership to take forward the choice the British people had decided upon.
2. Terror attacks will be put to check
The relationship between Britain and Nigeria following Brexit, will allow for real and long term security co-operation, to help prevent and combat the kind of attacks we have seen by terrorists in Europe, Nigeria and most recently London on the Houses of Parliament.
Britain says it is as committed as ever to working with international partners to achieve a safer, healthier and more prosperous planet.
The UK says it will continue to live up to its responsibilities as a permanent member of the UN Security Council, and its engagement as a NATO member will remain steadfast.
3. Great contribution to commonwealth
The UK's contributions through membership of the G7 and G20 will remain constructive and crucial to global stability. It's links with the Commonwealth, of which Nigeria is a key and major member, are unique and dynamic. The United Kingdom’s undertaking to spend 0.7% of Gross National Income on international development, and 2% of Gross Domestic Product on defence is enshrined in its law and means that the UK is the only major economy to meet both those commitments.
4. Stronger ties to Nigeria and Africa
The UK's diplomatic network – its number of embassies and offices – extends across the continent. The UK is still the largest European overseas investor in sub-saharan Africa, and the second largest globally. According to Paul Thomas Arkwright, the UK remains committed to helping partner African states to alleviate poverty across the continent.
Specifically, the UK has said that across Africa through its spending on international development in the next 5 years, it will support 5.8 million children to gain a decent education, support 23.7 million people to have sustainable access to clean water or sanitation and provide 31.2 million women, adolescent girls and children with nutritional support.
The UK’s impact will be felt across Africa, as it plans to remain a steadfast partner to the continent.
5. Bilateral trade gets better
In many ways very little has changed following Brexit, its bilateral trade relationship is still worth £3.8bn per annum. Shell, a British-Dutch company, has still invested billions of pounds into Nigeria and has around sixty onshore or shallow water oilfields and seven hundred wells.
Shell still owns approximately one third of oil produced in Nigeria. Nigeria remains the largest oil producing country in Africa, in spite of the depressed price of oil at this time.
The historical and cultural links between Nigeria and the UK, the common language of English that the vast majority of Nigerians speak, the strong educational and business links don’t change.
If anything, the connection will become stronger. The UK is naturally looking to grow its market share, to encourage more businesses to come to Nigeria and to invest and to encourage more inward investment into the UK from Nigeria.
Fixed Income investors will also benefit, they can invest and hedge their investments, at the Nigeria FX Futures, and giving them confidence that they can exit at will. Those who import from the UK will also benefit from the devalued Naira, particularly manufacturing companies with UK ties.
Parents who have children in the UK also will be able to buy the pound Sterling cheaper. This will compensate them for the loss in the value of the Naira, because Nigerians spend a large proportion of their FX expenditure in the UK, Nigerians will save some money from the lower valued Sterling.
The Central Bank of Nigeria (CBN) has said that the decision of the British people to leave the European Union (EU) will boost Nigeria’s foreign exchange policy.
Commenting on the outcome of the British referendum, CBN deputy governor, economic policy, Dr Sarah Alade said that the bank expected Britain’s vote to exit the European Union to be good for its forex policy as interest rates are likely to stay low in the US., channeling foreign investors to Nigeria.
“We only need to take advantage of this opportunity to grow the economy,” she said.
6. An increase in travel exchange is possible
It is not totally certain if Brexit will mean more Nigerians travelling to the UK. In 2015, around 140,000 people applied for visas to the UK. Of those that applied for student visas, 90% were successful. For those that applied for other visas, around 70% were successful. Most people for some reason doubt this but it is true. UK also introduced a same day service – at a cost – for visas in Nigeria. And a service that can mean you get a visa within 5 days, at a lower cost than the same day process. The UK's turnaround time for all other visas is 15 days.
So UK wants Nigerians to travel to Britain, especially because Nigerians come to do business, to study, to see family and to invest in our economy.
There could be as many as 250,000 Nigerian nationals or dual Nigerian – British nationals living in the UK at the moment. The key thing for any visitor to the UK, whether they are from Nigeria or anywhere else, is that they respect the law and the length of time their visa says they can stay in the UK. A minority of Nigerian visitors don’t do that and it is only with that minority that UK has an issue.
It remains a possibility that Brexit will mean more British travellers visiting Nigeria, for the same reasons that Nigerians come to the UK.
In particular, there is a longing for to come and explore the business opportunities that Nigeria offers. Its is assumed that there are roughly 20,000 British and dual nationals living in Nigeria now. That figure may grow as British businesses of all sizes are encouraged to look outward still further, to export and do business, creating jobs in Nigeria.
It would help UK of course if the process of getting a Nigerian visa was made easier. UK citizens should meet the requirements that the Nigerian government sets when they apply for a visa.
In conclusion, whatever Brexit means for the UK, it is also clear that Nigeria is going through a painful adjustment period as the government seeks to diversify the economy away from being dependent on oil and gas and into other areas. The UK supports that approach.
The price of oil may increase, but that industry alone can’t support the need for jobs that Nigerians now have. That’s why the UK’s Department for International Development has its second largest programme in Africa here in Nigeria, helping with the immediate needs of those in desperate circumstances in the north-east of Nigeria.
The UK has been among the leaders of the international response to the humanitarian crisis in the north-east of Nigeria. It scaled up its humanitarian funding from £1m in 2014 to 2015 to £74m in 2016 to 2017.
In 2016 in Nigeria, UK delivered food assistance to more than 1 million people and treated 34,000 children at risk of death from severe under-nourishment. Britain provided essential household items to more than 225,000 people who have fled from their homes and provided more than 135,000 people access clean water and sanitation. But the UK’s development programme in Nigeria is also about education, growing the Nigerian economy with the skills that it needs for its population today and as that population expands.
However, what happens here in Nigeria and the choices made by the Nigerian government will be more important for the Nigerian economy than whatever Brexit may mean for Nigeria.
Nigerian youths are enterprising and can-do so much to turn things around for the Nation. It is not oil or gas that are Nigeria’s most important resource but its people.
The human capital that Nigeria has – Nigerians themselves and their drive, determination and ability to get things done often when facing considerable challenges – are what makes Nigeria stronger and united till date.
Britain will emerge still stronger and more engaged with the world and Nigeria thereafter.
The Brexit referendum was all about the British people deciding their future. The question was clear: “Should the United Kingdom remain a member of the European Union, or leave the European Union?”
The campaign was conducted with plenty of argumentation about the issues, the vote was held. Turnout was high, at over 72%. The electorate gave their verdict. A 52% majority voted to leave the European Union. And it is now the duty of Government and Parliament, to give effect to that democratic decision.
"That is how democracy works" says Paul Thomas Arkwright , and "that’s what happens when the people decide what they want for their country and their future," the diplomat concludes.
British Prime Minister, Theresa May, has made a very clear statement: “Brexit means Brexit, and we are going to make a success of it.”
She has also been clear that making a success of Brexit is the most important task of the British Government. There will be many elements to making a success of Brexit.
What will success look like? Ultimately it will be for the Prime Minister and her cabinet to determine, and present to the British parliament for their vote. But what is evident is that the UK will be looking for mutually beneficial arrangements that serve its intertwined interests well.