Themorningbellbd.com Desk, June 25: Britain was under pressure on Saturday to set out a quick timetable for a divorce from the European Union after the country’s historic vote to leave the bloc sent shockwaves around the world.
Global stock markets plunged on Friday, and sterling saw its biggest one day drop in history after Britons voted by 52-48 percent to exit the EU, which it joined more than 40 years ago.
Ratings agency Moody’s downgraded its outlook for Britain, saying its creditworthiness was now at greater risk as the country would face substantial challenges to successfully negotiating its exit from the bloc.
European Commission President Jean-Claude Juncker said he wanted to begin negotiating Britain’s departure immediately.
Meanwhile, EU states have urged Britain to hold speedy talks on leaving the bloc after it voted to end its membership in a historic referendum.
German Foreign Minister Frank-Walter Steinmeier said negotiations should begin as “soon as possible”.
He made the comments after an urgent meeting of the six EU founder members to discuss the decision.
British PM David Cameron has said he will step down by October to allow his successor to conduct talks.
The six countries attending the summit in Berlin – Germany, France, Italy, Belgium, Luxembourg and the Netherlands – first joined forces in the 1950s and still form the core of the EU.
“We say here together, this process should get under way as soon as possible so that we are not left in limbo but rather can concentrate on the future of Europe,” Mr Steinmeier said.
His Dutch counterpart Bert Koenders said the continent could not accept a political vacuum, saying “this will not be business as usual”. In other developments:
The first summit of EU leaders with no British representation will be held on Wednesday, a day after Mr Cameron holds talks with members.
Global stock markets and the pound fell heavily on the news of the so-called “Brexit”, while credit rating agency Moody’s cut the UK’s outlook to “negative”.
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The UK must now invoke Article 50 of the EU Lisbon Treaty, which then allows for two years for withdrawal to be negotiated.
European Commission head Jean-Claude Juncker said the EU-UK split was “not an amicable divorce”, but nor had they had a “deep love affair”. He has also said exit negotiations should begin immediately.
“Britons decided yesterday [Thursday] that they want to leave the European Union, so it doesn’t make any sense to wait until October to try to negotiate the terms of their departure,” Mr Juncker said in an interview with Germany’s ARD television network.
In another interview, with Bild newspaper, he said it was “first and foremost” a matter for Britain’s EU commissioner Lord Jonathan Hill to decide whether to stay in his role, in charge of EU financial services.
German Chancellor Angela Merkel will meet French, German and Italian leaders in Berlin on Monday to discuss future steps, and the foreign ministers of Germany, France, Italy, Belgium, the Netherlands and Luxembourg, will meet on Saturday morning.
U.S. President Barack Obama on Friday tried to limit the fallout from Britain’s vote to leave the European Union which threatens to harm the U.S. economic recovery and distract U.S. allies from global security issues.
Obama vowed that Washington would still maintain both its “special relationship” with London and close ties to Brussels, but stood by his warning that Britain would move to the back of the queue when it came to trade deals.
U.S. presidential candidate Donald Trump, whose own rise has been fueled by similar anger at the political establishment, called the vote a “great thing”.
Supporters of Islamic State and al Qaeda said Britain had divided and weakened itself, according to the SITE monitoring service. Militant Islamists took to the internet to applaud the British vote, with one saying it marked the “beginning of the disintegration of the Crusaders”.
The British pound fell as much as 10 percent against the U.S. dollar on Friday to levels last seen in 1985 on fears the decision could hit investment in the world’s fifth-largest economy, threaten London’s role as a global financial capital, and usher in months of political uncertainty. The euro slid 2.0 percent against the U.S. dollar.
World stocks saw more than $2 trillion wiped off their value. European stocks ended down 7.0 percent, the biggest one day fall since 2008. U.S. stocks fell suffered the largest selloff in ten months sharply, with the Dow Jones industrial average losing 3.4 percent. [.N]
Investors put their cash in the safety of gold, which clocked up its biggest daily gain since the global financial crisis of 2008, ending Friday up 5.0 percent at $1,315 an ounce.
Ratings agency Moody’s said Britain was at risk of a credit downgrade, assigning a negative outlook to its ‘Aa1’ rating for British government debt.
“During the several years in which the UK will have to renegotiate its trade relations with the EU, Moody’s expects heightened uncertainty, diminished confidence and lower spending and investment to result in weaker growth,” the agency said.