CHEBET: London’s burning! Who will put out the fire?


CHEBET: London's burning! Who will put out the fire?

Fetch the engines, fetch the engines!
Fire fire, Fire Fire!
Pour on water, pour on water.

As little kids, we sang this nursery rhyme often, mumbling our own words as we rarely had a chance to find the rhyme book to read the real words from, we just learnt the words from other children.

However, this popular nursery rhyme of yore has taken on a new form in recent days.

World Economists concur that what UK’s Prime Minister David Cameron’s office at 10 Downing Street should have meticulously managed was largely underwhelming due to the over confidence of the ‘stay’ voters. The Brexit has generated so much heat that has quickly spread to markets around the world, exerting significant pressure on the pound and trillions of dollars wiped out across key stock markets across the world.

The Brexit was, in fact, a stark reminder of the impact Britain has on the world economy.

The clearly emotional debate is growing by the day, and campaigners of the Brexit are now being accused of fueling a campaign riding on the fears of the ‘Have-Nots’, who are most affected by the strain that globalization and  immigration has placed on the British government. Yet somehow, the clarity that was required by the ‘stay’ campaigners was a little uninspiring and spectacularly failed to convince the 52% who voted for Britain to leave the European Union.

I must admit, however, that Brexit figurehead campaigner, Michael Gove, grabbed my attention last week, a powerful orator, the intelligibility of purpose was clear and quite convincing. His state of agency was unwavering, and it wasn’t hard to see why, even with a tight 4% margin, the ‘leave’s’ had it.  Gove put his hand on the plough and didn’t look back; I believe that even he was shocked that his Brexit won the day.

I have been following the intense Brexit conversation both online and offline, and as of last week, I was almost sure that Britain would stay. On Wednesday, however, just a day before the vote, I stumbled upon a Facebook post by Footballer David Beckham, stating why he was voting to stay. But it wasn’t his post that struck me; it was the hundreds of comments thereafter, from what I read were regular Brits expressing why they would rather Britain left the EU.

The emotionally packed comments section was mostly about how Britain’s rich had lost touch with the ordinary life in Britain, where Education, Health and Housing were continuously under pressure. They went on to tell Beckham that he had a life outside Britain and he and his family did not have to deal with lack of basic amenities such as healthcare which had taken a beating due to a rise in the number of immigrants.

‘Leave’ campaigner Nigel Farage, during his campaigns, had said: “If immigration continues at the current rate, our population will be 80 million by 2040, and just to cope with that, we need to build a new house every four minutes, night and day, just to cope with the current numbers”.

A report by Migration Observatory showed that between 2011 and 2015, the total number of EU-born migrants living the UK increased by 696,000 to 3.277 million. Other reports show that in 2015 alone, an estimated 270,000 citizens from other EU countries immigrated to the UK, the number of EU citizens in the UK is said to be about 5% of Britain’s population.

Critics of globalization and immigration won the Brexit debate, with so called populist campaign themes raving the emotions of the segment of the population that hurts the most from globalization and its capitalistic ways. I suppose the question and perhaps the lesson even for us in East Africa would be what cushions the poor when Globalization really starts to happen?

Across the pond, it gets worse. Scotland may seek independence, terms such as a less important Europe are now being bandied about, as well as questions such as “Will the EU survive this?”

France may leave the EU, and Britain may just go back to England again, closely watching its borders.

Will Kenya be affected by Britain move to leave the EU? Kenya’s Central Bank Governor says the country has enough foreign exchange reserves and funds available from an IMF standby facility to weather any fallout from the British vote.

Banker and Economist Mohammed While shared with me recently about the impact on rest of the world from a financial markets perspective rather than trade in goods and services saying London is the financial market nerve and the Sterling Pound’s depreciation would be major disruption to the UK financial sector is likely to be transmitted globally.

But, he adds, like the financial crisis of 2008, no one knows the known unknowns. It would become contagious and transform from banking into sovereign risk.

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