Pound’s crash hits expat pockets as PM outlines Brexit timetable
UK prime minister Theresa May met German Chancellor Angela Merkel in July to discuss their post-Brexit relationship. Picture: Crown Copyright/Tim Evans.
The UK prime minister Theresa May confirmed on Sunday that she will start formal negotiations for Britain to leave the EU by March 2017.
Once the prime minister triggers Article 50, Britain has two years to negotiate a new deal with the EU. The results of the negotiations will affect the status of British people living throughout Europe, who, under EU rules, currently have the right to live, work and study anywhere in the territory.
Sterling crisis
Immediately following the prime minister’s announcement, the pound fell against the euro. This means that British citizens who live in Spain and receive incomes in sterling will have less to spend once their money is converted to euros.
Then in the early hours of Friday morning, a ‘flash crash’ hit the markets with sterling briefly falling below €1.10 for the first time since early 2010.
HSBC analysts predict that the pound will be worth just one euro by the end of 2017.
Status of expats in Spain
Theresa May’s speech at the Conservative Party conference this week, was interpreted by many as demonstrating that she is leaning towards a ‘hard Brexit’, where Britain gives up full access to the single market in order to fully control its border.
Gideon Rachman at The Financial Times thinks that by making the announcement about the Brexit timetable before getting any guarantees from the EU, Theresa May has weakened the country’s negotiating power. He warns that this will cause severe damage to the country’s economy.
The futures of the estimated 800,000 British people living in Spain remain uncertain. Spain’s foreign minister, José Manuel García-Margallo, is reported to have said that Britain will have to reach a deal to pay for expats’ healthcare once Britain leaves the EU.
‘We must reach an agreement for residents to access health services in Spain, but covered by the United Kingdom,’ he said.
Spain’s foreign minister, José Manuel García-Margallo, predicted on Wednesday that Brexit would lead to Gibraltar starting to negotiate a joint sovereignty agreement with Spain. He said: ‘When Brexit becomes effective, Gibraltarians will have two choices: ‘Being British outside the European Union or Spanish-British within the EU.’
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