The UK’s new Prime Minister Boris Johnson emphasized that the country would leave the EU regardless of an agreement by the end of October in his first speech at the parliament after gaining the post.
Addressing the House of Commons, Johnson said while he would prefer to leave the EU with a deal, he has assigned minister Michael Gove, to make plans for a no-deal Brexit his top priority. He told MPs that his government will restore pride of the U.K. and make it center of global business and finance, by negotiating free trade deals with Europe and the U.S.
Declaring that country’s immigration policies need to be reformed, he said the government will introduce the "Australian-style points based system". In this system, points are allocated for age, professional experience, English language ability and qualifications, with extra points available for earning a qualification in Australia.
Predicting that by 2050, the U.K. will be the greatest and most prosperous economy in Europe, Johnson said to realize such dream, it was necessary to restore trust in democracy and fulfill repeated promises made by the Parliament to people that included leaving the EU.
Johnson hoped that Brussels will rethink its refusal to renegotiate May’s withdrawal agreement.
“If they (EU) does not negotiate, we will of course have to leave the EU without an agreement under Article 50. The U.K. is better prepared for that situation, than many believe” Johnson said.
On Saturday, thousands of people gathered outside parliament in central London on Thursday calling for a general election. The demonstration was organized by the opposition Labour party and saw its leader, Jeremy Corbyn, urge new Prime Minister Boris Johnson to call a general election and give the people the power to elect their own government.
Holding placards that read “No To Racism! No To Boris Johnson!” and “Rebuilding The Country For The Many, Not The Few”, protestors chanted Corbyn’s name as well as other pro-European Union and pro-Labour chants.
“We have a prime minister who has been elected by the few, leading a party of the few and will represent the few, not the many. It is time that he calls a general election and gives the people a say on who will govern them,” Corbyn said.
The election of Boris Johnson as leader of the UK Conservative Party further increases the risk of a no-deal Brexit, but domestic political outcomes, and therefore the timing and nature of the UK's exit from the EU, are still highly uncertain, Fitch Ratings said last week.
“When we affirmed the UK's 'AA' sovereign rating on 26 April we said that domestic political volatility could lead to a no-deal Brexit which, in our view, would cause substantial disruption to UK economic and trade prospects, at least in the near term.” Fitch Ratings said.
The probability of the United Kingdom (UK, Aa2 stable) leaving the European Union (EU) without any agreement on their future relationship has increased following the election of Boris Johnson as Conservative Party leader, Moody's Investors Service said in a report on 23rd of July.
"With the election of Mr Johnson, the likelihood of a sustainable compromise appears lower than before," said Colin Ellis, Moody's Managing Director - Credit Strategy. "Our view remains that a no-deal Brexit would have significantly negative credit effects for the UK sovereign and related issuers."
Since the outcome of the Brexit referendum, Moody's central expectation has been that the UK and the EU would reach a withdrawal agreement that preserves many of the features of current trading arrangements, particularly for goods. Although this would be credit negative compared with staying in the EU, it would be significantly less damaging than a no-deal Brexit.
While Boris Johnson is trying to unite the country, his choice of cabinet ministers are considered to be the most right wing cabinet in the British history. With his uncompromising rhetoric and EU’s current position, risk of no deal is rising. As Northern Ireland open border policy is under the risk of a hard border with Ireland after 31st of October, there could be significant concerns mounting on uncertainties on UK economy in the short and medium term.