Brexit: What Does It Mean for International Traveler?

Brexit: What Does It Mean for International Traveler?

On June 23, 2016, by a margin of 52% to 48%, the United Kingdom (UK) voters unexpectedly opted to leave the European Union (EU). When and how this extrication will take place is still very much undecided. The British Prime Minister has resigned and, as a result, formal UK-EU exit negotiations will probably not begin until a new PM is elected.

So, beyond trade agreements and politics, what are the potential/probable effects of all of this on travelers to and from the UK?

First the good news?

The morning after the UK voted to leave the EU, the British Pound dropped to its lowest level against the US Dollar in 31 years. It hasn’t been since 1985 that the Pound has sunk so low. The precipitous drop from earlier in June of more than 10% does have its advantages for those traveling to the land of fish and chips.

 If you are thinking of going to London or anywhere else where the Pound rules, now is the time. Once there, everything will be much less expensive, in terms of US dollars, than they were a month ago! For instance, next week (July 4-10,2016), a room in Marriott's County Hall, a few steps from the London Eye on the South Bank of the Thames - available for £278 - will cost you about $370 per night. Mid-June, the same room would have cost around $410. In Manchester at Kingfisher’s at Salford Shopping City the standard Fish and Chips dinner today will cost you $3.85. Two weeks ago, the same meal would have set you back $4.30.

Note, also, that the Euro has dropped almost 2%, not as drastic as the Pound, but it means that the rest of the EU is also slightly cheaper than it was a month ago for those purchasing with the Dollar.

Bad News for UK based travelers!

Taking a UK based perspective, the plunge of the Pound has the opposite effect: Travel from the UK just got more expensive. A one-day ticket to Disney’s Magic Kingdom Park in Orlando, Florida, in mid-June, would have cost about £72. Next week the same one-day pass will cost £79.

Quoting survey information from travel-deals publisher, Travelzoo, Conde Nast speculated a reduction in travel to the UK. As a result of Brexit, one-third of travelers from Germany, Italy and Spain – and one quarter from France – said they would be less inclined to visit the UK. Even with the reduced Pound, 10% of travelers from the US and 12% from Canada said the same.

 Beyond the potential effects on UK's tourism industry, this also could be a bounty for those willing to venture there. London, especially, gets very crowded during the summer months. Maybe it won't be quite as crowded, and you might be able to get a table at that restaurant you have been longing to try.

Possible end for “borderless” travel to and from the EU

Entering the EU from the UK and the UK from the EU currently does require going through a border check. These controls will undoubtedly continue and over time will most likely be enhanced. Travelers to and from the UK, who do not require visas today are unlikely to need visas in the future, but, the scrutiny of UK citizens traveling to the EU and vice-versa will most certainly intensify, especially on the UK side.

Potential increased costs to travelers to the UK

Internet Access: All roaming charges across the EU were due to be eliminated in 2017. What effect that will have on those in the UK or travel to the UK is now uncertain. The UK can now establish its own policies concerning Internet access and roaming. And, if history is anything of an indicator, charges are more likely to go up rather than down.

If you are a Keepgo customer, however, your roaming charges for Internet access will remain at the current rates. Keepgo has negotiated individual contracts with the service providers in each country (e.g., Telefonica O2 in the UK, KPN B.V. in The Netherlands, etc.). Brexit should not effect these individual contracts. If you are not yet a Keepgo customer, please check out our service offerings on their website.

Airfares: It is hard to estimate the long-term effect of Brexit on airline prices, but it will certainly influence the low-fare airlines providing access to the UK from the rest of the EU. Increases in the formality of border crossing will likely increase the airline's cost, which will, undoubtedly, be reflected in ticket prices. Airlines like UK-based EasyJet, Ireland’s Ryanair and Germany’s German Wings will need to be monitored for pricing trends.

Interestingly, the day after Brexit, Virgin Atlantic and a number of other airlines reduced their prices for a round trip to London from the US this autumn to around $500. But whether this will be the trend for the long run is yet to be determined.

Duty-Free: Currently a traveler from France entering the UK can bring in as much wine as he or she would like. They would have paid €0.23 per 750ml bottle in duty in France but avoided a £2.08 UK tax. Duties are very likely to change, and the cost of carrying goods like wine, liquor, and tobacco products across borders will certainly go up for travelers.

Other Impacts

Expatriates: Until the UK and EU get to the details of their negotiations, the fates of those UK citizens living (retired and/or working) in the EU and EU citizens living (retired and/or working) in the UK is very unclear. It is highly likely that those currently with expatriate status will be allowed to continue as such. The real impact may be on the mobility of the workforce across the UK-EU borders. UK citizens just entering the job market may find a much smaller marketplace available to them and EU citizens may not have access to some of the higher paying jobs in the UK.

 Scexit, Frexit, Nexit?: Scotland had overwhelmingly voted to remain in the EU. Upon the announcement of the result of the Brexit vote, the First Minister of Scotland, Nicola Sturgeon, stated the intention of starting a campaign to split Scotland from the rest of the UK, so it could remain in the EU. Of course, it is much too early in the process to predict how this will play out. But if it does happen you might have to go through customs to fly from London to Edinburg. There have also been rumblings, primarily from the far right, in both France and The Netherlands, of wanting to leave the EU.

 Uncertain is the way forward

The only thing that is sure about Brexit’s effects is that they are unknown at this time. According to the “rules” of the EU, this separation of the ways has to be negotiated and in place within two years. Many of the pundits and analysts are predicting it could take at least double that time.

 So, the best we can offer is: Get your International Mobile Data SIM card or WiFi Hotspot for travelers and head off to the UK and the EU to take full advantage of the fall in the Pound and the Euro, while it lasts!