Just an hour and a half ago, polls closed for the Scottish referendum; now, the entire world looks on to what could catalyse the fall of Europe and will definitely impact global markets and in particular, European economies.
Secessionist movements have been deeply rooted in EU history- though in recent years the European economic crisis, the Crimean conflict, and others have escalated the independence movements and euroscepticism both in countries, such as Scotland in the UK, Catalonia in Spain, Flanders and Wallonia in Belgium, and within the EU, such as the UK’s desired separation from the EU.
If Scotland secedes from the UK, not only will the UK lose 1/3 of its territory and a significant amount of its economy, it would almost certainly trigger secessionist movements all across Europe, and weaken the already sliding EU economy. As of today the pound has already dropped to $1.61 from $1.71 in early July- and investors are likely to continue to pull out. Likewise, it is uncertain how balance in the EU will be achieved- will the UK and Scotland attain full automatic membership to the EU, or will Scotland have to reapply? Will the UK want to reapply? Spain will not likely want to grant automatic membership to Scotland due to Catalonia, but if the UK leaves the EU, it will be a huge blow to the EU bail-out fund which may throttle EU stability and impact local and international businesses in the EU. Further, the many benefits of an open economy within the EU for companies would have to be revisited for said countries.
Photos from: http://www.bbc.com/news/scotland/
Follow