Brexit — How will Singapore be affected
The people of Britain have spoken. And they’ve voted for the United Kingdom to leave the European Union (52% to leave vs 48% to remain). Within hours, Prime Minister David Cameron announced his resignation and the Pound has tumbled to a 30-year low. But what would Brexit mean for Singapore?
Since an exit of a global player from the EU is unprecedented, we can only guess at how things could affect us.
Depreciating Pound Sterling
- For parents how have children studying in the UK, their school fees will be cheaper
- It’ll also be cheaper for Singaporeans who want to invest in their property
- But it would also be more expensive for British companies to invest overseas, which could trigger an economic slowdown
- It’ll be cheaper for Singaporeans to visit the UK, but it’ll be more expensive for them to visit us, affecting our tourism industry
- With the lower Power Sterling and the recent Free Trade agreement with the EU, exports and imports between the EU and Singapore will be cheaper and subject to less restrictions and requirements.
- But majority of our trade is with Britain. Hence, 2 things can happen, UK’s economy could become weaker without the support of the EU, making them less attractive with Singapore businesses OR becoming independent may give them more bargaining power since they’re no longer subjected to the regulations of the EU
- That being said, the lower pounds could also attract more Singapore companies to trade and invest in UK, since it’s now cheaper
- It’ll spark turmoil in global financial markets due to the uncertainty it will bring. Asian markets took a tumble this week from fears over Brexit.