Prime
Minister David Cameron says he will resign by the fall and insists the British
people's will must be respected after voters chose to leave the 28-nation
European Union.
Cameron
says there can be no doubt about the result of Thursday's historic vote but
that he is not the "captain" that will steer the ship through
difficult negotiations with the EU.
He
says he will resign by the time of the Conservative party conference in the
fall.
British
stocks are plunging as the market opens as investors scramble to react to the
news. The pound has hit a 31-year low.
This
is a developing story. The earlier version follows.
LONDON
(AP) — Britain voted to leave the European Union after a bitterly divisive
referendum campaign, sending global markets plunging Friday, casting British
politics into disarray and shattering the stability of a project in continental
unity designed half a century ago to prevent World War III.
The
decision launches a yearslong process to renegotiate trade, business and
political links between the United Kingdom and what will become a 27-nation
bloc, an unprecedented divorce that could take decades to complete.
"The
dawn is breaking on an independent United Kingdom," said Nigel Farage,
leader of the U.K. Independence Party. "Let June 23 go down in our history
as our independence day!"
The
"leave" campaign won with 52 percent of the vote, the U.K. electoral
commission said Friday. Turnout was high: 72 percent of the more than 46 million
registered voters went to the polls.
Polls
ahead of the vote had shown a close race, but the momentum had increasingly
appeared to be on the "remain" side over the last week. The result
shocked investors, and stock markets plummeted around the world. The pound
suffered one of its biggest one-day falls in history, plunging more than 10
percent in six hours, from about $1.50 to below $1.35, on concerns that
severing ties with the single market will hurt the U.K. economy and undermine
London's position as a global financial center.
The
U.K. would be the first major country to leave the EU, which was born from the
ashes of World War II as European leaders sought to build links and avert
future hostility. With no precedent, the impact on the single market of 500
million people — the world's largest economy — is unclear.
The
referendum showed Britain to be a sharply divided nation: Strong pro-EU votes
in the economic and cultural powerhouse of London and semi-autonomous Scotland
were countered by sweeping anti-Establishment sentiment for an exit across the
rest of England, from southern seaside towns to rust-belt former industrial
powerhouses in the north.
"It's
a vindication of 1,000 years of British democracy," commuter Jonathan
Campbell James declared at the train station in Richmond, southwest London.
"From Magna Carta all the way through to now we've had a slow evolution of
democracy, and this vote has vindicated the maturity and depth of the democracy
in our country."
Others
expressed anger and frustration. Olivia Sangster-Bullers, 24, called the result
"absolutely disgusting."
"Good
luck to all of us, I say, especially those trying to build a future with our
children," she said.
The
vote is likely to cost Prime Minister David Cameron his job. The leader of the
ruling Conservative Party called the referendum largely to silence voices to
his right, then staked his reputation on keeping Britain in the EU. Former
London Mayor Boris Johnson, who is from the same party, was the most prominent
supporter of the "leave" campaign and now becomes a leading contender
to replace Cameron. It also dealt a blow to the main opposition Labour Party,
which threw its weight behind the "remain" campaign.
"A
lot of people's grievances are coming out and we have got to start listening to
them," said deputy Labour Party leader John McDonnell.
After
winning a majority in Parliament in the last election, Cameron negotiated a
package of reforms that he said would protect Britain's sovereignty and prevent
EU migrants from moving to the U.K. to claim generous public benefits.
Critics
charged that those reforms were hollow, leaving Britain at the mercy of
bureaucrats in Brussels and doing nothing to stem the tide of European
immigrants who have come to the U.K. since the EU expanded eastward in 2004.
The "leave" campaign accuses the immigrants of taxing Britain's
housing market, public services and employment rolls.
Those
concerns were magnified by the refugee crisis of the past year that saw more than
1 million people from the Middle East and Africa flood into the EU as the
continent's leaders struggled to come up with a unified response.
Cameron's
efforts to find a slogan to counter the "leave" campaign's emotive
"take back control" settled on "Brits don't quit." But the
appeal to a Churchillian bulldog spirit and stoicism proved too little, too
late.
The
result triggers a new series of negotiations that is expected to last two years
or more as Britain and the EU search for a way to separate economies that have
become intertwined since the U.K. joined the bloc on Jan. 1, 1973. Until those
talks are completed, Britain will remain a member of the EU.
Exiting
the EU involves taking the unprecedented step of invoking Article 50 of the
EU's governing treaty. While Greenland left an earlier, more limited version of
the bloc in 1985, no country has ever invoked Article 50, so there is no
roadmap for how the process will work.
Authorities
ranging from the International Monetary Fund to the U.S. Federal Reserve and
the Bank of England have warned that a British exit will reverberate through a
world economy that is only slowly recovering from the global economic crisis.
"It
will usher in a lengthy and possibly protracted period of acute economic
uncertainty about the U.K.'s trading arrangements," said Daniel Vernazza,
the U.K. economist at UniCredit.
Follow
the latest Brexit news via BreakingNews.com
The
European Union is the world's biggest economy and the U.K.'s most important
trading partner, accounting for 45 percent of exports and 53 percent of
imports.
In
addition, the complex nature of Britain's integration with the EU means that
breaking up will be hard to do. The negotiations will go far beyond tariffs,
including issues such as cross-border security, foreign policy cooperation and
a common fisheries policy.
Among
the biggest challenges for Britain is protecting the ability of professionals
such as investment managers, accountants and lawyers to work in the EU.
As
long as the U.K. is a member of the bloc, firms registered in Britain can
operate in any other member state without facing another layer of regulation.
It's the same principle that allows exporters to ship their goods to any EU
country free of tariffs.
Now
that right is up for negotiation, threatening the City, as London's financial
heart is known, and its position as Europe's pre-eminent financial center.
Many
international banks and brokerages have long used Britain as the entry point to
the EU because of its trusted legal system and institutions that operate in
English, the language of international finance. Britain's financial services
industry is also surrounded by an ecosystem of expertise — lawyers, accountants
and consultants— that support it.
Some
60 percent of all non-EU firms have their European headquarters in the U.K.,
according to TheCityUK, which lobbies on behalf of the financial industry. The
U.K. hosts more headquarters of non-EU firms than Germany, France, Switzerland
and the Netherlands put together.
"We
believe this outcome has serious implications for the City and many of our
clients' businesses with exposure to the U.K. and the EU," said Malcolm
Sweeting, senior partner of the law firm, Clifford Chance. "We are working
alongside our clients to help them as they anticipate, plan for and manage the
challenges the coming political and trade negotiations will bring."
JPMorgan
Chase Chief Executive Jamie Dimon said earlier this month that a vote to leave
would force his bank to move jobs to mainland Europe to ensure that it could
continue to service clients in the EU. Other global businesses with customers
in the rest of the EU will be in a similar situation.
The
only question that remains is whether the dire economic predictions economists
made during the campaign will come to pass.
"Uncertainty
is bad for business," Vernazza said. "A sharp fall in U.K. risky
asset prices, delays to investment, disruption to trade, and a loss of business
and consumer confidence mean the U.K. economy is more likely than not to enter
a technical recession within two years."
Associated
Press writers Raphael Satter and Frank Jordans in London and Shawn Pogatchnik
in Dublin contributed to this report.
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