UK election: Five issues that need watching for Brexit risk

David Cameron’s Conservative party has confounded pollsters by winning an absolute majority in the House of Commons in the general election on May 7th. The other election winner was the Scottish National Party (SNP) that can now claim 56 of the 59 seats that Scotland has in the Westminster parliament. Labour, the main opposition party, is in disarray after its disappointing result, as are the Liberal Democrats, Mr Cameron’s erstwhile coalition partner.

Mr Cameron’s victory removes uncertainties that Labour’s strong showing in the opinion polls had raised over post-election economic management and business regulation. Mr Cameron has a clear mandate to continue his pro-business and fiscally conservative policies. His party has pledged to close the budget deficit by 2018-19 – although other election pledges, such as ruling out increases in key taxes, could reduce the government’s fiscal room for maneuver.

Nevertheless, business leaders and investors in Britain will face considerable uncertainty over the next couple of years. The big questions going forward concern the cohesion of the United Kingdom and the UK’s future inside the EU.

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Katinka Barysch
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