{"id":3612,"date":"2017-05-29T08:30:41","date_gmt":"2017-05-29T07:30:41","guid":{"rendered":"https:\/\/blog.iese.edu\/doing-business\/?p=3612"},"modified":"2017-06-26T07:48:12","modified_gmt":"2017-06-26T06:48:12","slug":"a-win-for-labour","status":"publish","type":"post","link":"https:\/\/blog.iese.edu\/doing-business\/2017\/05\/29\/a-win-for-labour\/","title":{"rendered":"A Win for Labour?"},"content":{"rendered":"
\"Jeremy<\/a>
Jeremy Corbyn<\/figcaption><\/figure>\n

Due to tremendous miscalculations\u00a0made by Teresa May<\/strong>‘s conservative party on the issue of pensions and an increasingly impressive campaign by Labour’s Jeremy Corbin<\/strong>, the polls are narrowing in the run up to the June 8th General Election in the United Kingdom. As of last week, the latest polls showed Labour only 6-7% behind the Tories and every poll seems to show them getting closer and closer.<\/p>\n

From a geo-political viewpoint, what is significant about the\u00a0vote is that without the strong showing that Mrs. May was expecting when she called the snap election, it may be very difficult for her government (if she does end up\u00a0winning) to effectively negotiate the UK’s exit from the European Union on its own terms. A weakened Tory government may find itself forced to soften its positions and even call for a new referendum once the details of the exit are more clear.<\/p>\n

An unexpected Scenario<\/strong><\/p>\n

There is, however, a scenario where Labour might win the election or perhaps, be in a position to form a broad coalition to replace Mrs May. All of this has much to do with the myriad details of politics in different parts of the United Kingdom including Scotland and Northern Ireland. While I am not an expert, it seems that the Scottish\u00a0National Party (SNP) and Sinn\u00a0Fein may end up holding the keys to a labour government and that could unwind Brexit and send Europe on a very different path in the years to come.<\/p>\n

According to the Guardian<\/a>, the SNP is likely not to dominate the vote as it did back in 2015 when it won 56 out of the 59 seats from Scotland. The thing is if Labour continues to rise in the polls and the SNP manage to win 40-50 seats, then it might hold the balance. It will likely then request another referendum in support of a new labour government.<\/p>\n

\"Michelle<\/a>
Michelle O’Neil and Gerry Adams<\/figcaption><\/figure>\n

An even more interesting scenario would develop if Labour, the Liberal\u00a0Democrats, Plaid Cymru (Welsh nationalists), and\u00a0the Scots fell just short of a majority in Westminster. If that were to happen then Sinn Fein’s\u00a0Norther Irish seats might come into play. The good news (from a european perspective) is that Sinn fein might win as many as 7 seats and become\u00a0Northern Ireland’s largest party in Westminster. The bad news is that the Republicans have historically ran for office and then refused to take their seats arguing that Northern Ireland should be part of the Irish Republic. The thing is that if those 7 seats were the key to turning out the Tories and potentially scrapping the whole idea of Brexit, a key issue for Sinn Fein, then the Party might actually reconsider its boycott……<\/p>\n

What to do?<\/strong><\/p>\n

For me the continued uncertainty concerning\u00a0of Brexit is an excellent example of\u00a0how important it is for firms\u00a0not to focus on business as usual<\/em> and to continually look at the broader assumptions upon which its strategy is based.\u00a0With regards to Brexit, Prof. Nuria Mas, the head of the Economics Department at IESE Business School, talks about three scenarios and my advice is for business to be ready for all of them as well as my favorite<\/a> in which\u00a0the General Election, a new referendum or some really artful political negotiations and some needed reform keeps the U.K. in the European Union.<\/p>\n

\"download-1\"<\/a>Another scenario is what is normally referred to as a \u201chard exit\u201d in which the U.K. would end up with a relationship with Europe like any other non member country as per the rules of the World Trade Organization. In the U.K. this is now being called a \u201cclean exit\u201d as, according to Nuria, that sounds better. Most analysts concur that this will be a disaster for business.<\/span><\/p>\n

It seems very unlikely that the other European countries would allow the UK to walk away with little or no negative impact. According to the data,\u00a0the U.K. relies much more on Europe than the other way around and neither Germany or France will want to make it easy for Mrs. May.\u00a0<\/span>The problem is that\u00a0 <\/span>even if there was a will to do so, it usually takes years to negotiate complicated trade agreements and the clock is already ticking.\u00a0<\/span><\/p>\n

I, for one, am hoping for an upset by the Labour Party.<\/p>\n","protected":false},"excerpt":{"rendered":"

The surprising rise of the U.K’s Labour Party in the polls opens the possibility of an upset in the U.K.’s general elections which would be a good thing for Europe but more than anything else shows business that it needs to be ready for different scenarios.<\/p>\n","protected":false},"author":788,"featured_media":3621,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[25698,26749],"tags":[],"class_list":["post-3612","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-elections","category-geopolitics","megacategoria-mc-globalization"],"acf":[],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/posts\/3612","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/users\/788"}],"replies":[{"embeddable":true,"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/comments?post=3612"}],"version-history":[{"count":13,"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/posts\/3612\/revisions"}],"predecessor-version":[{"id":3630,"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/posts\/3612\/revisions\/3630"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/media\/3621"}],"wp:attachment":[{"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/media?parent=3612"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/categories?post=3612"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blog.iese.edu\/doing-business\/wp-json\/wp\/v2\/tags?post=3612"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}