The UK's citizens have decided to leave the Union. Europe is facing an unprecedented situation. For the first time, the European Union is facing a shrinking process instead of a enlargement one. The procedures are of similar complexity, once the UK will ask oficially for the leaving there would be several sectoral negotiation tables to achieve a global arrangement. Regarding the technological sector, there would be issues to be negotiated under the umbrella of different EU Council configurations.
Although the United Kingdom is not among the top five EU performers in the DESI, the Brexit will shake both the EU technological scene and the UK economy. As in many other economic sectors, both EU and UK will lose.
EU is losing an important force in its tech sector. According with the most recent OECD data, the ICT and subsectors contribution to UK GDP is 5,53%, the largest among the big five EU economies. Besides the UK current weight in the EU digital sector, UK has been a driving force in the inception of the Digital Single Market project currently under development. Furthermore, the now improbable UK presidency of the EU by the second semester of 2017 would have been a guarantee of a definitely push towards the conclusion of the negotiations of critical legislative proposals as the review of the audiovisual sector or the new rules for e-commerce (end of unjustified geoblocking, rules for online sales, regulation of cross-parcel delivery).
As for the UK, the Brexit will have a bigger impact on the ICT sector than in others. The last TechNation report noted that the UK digital economy grew a third faster than the UK economy as a whole and estimated that 1.56 million people were employed in digital companies in the UK. The access to the EU market has been a cornerstone of this thriving force. An important part of the human and financial capital needed to bulid the sector came from Europe. On one hand, there will be new barriers to inmigration and recruiting EU workers in a country that leads the number of forseen unfilled vacancies by 2020 in the ICT sector. On the other hand, there could be a decrease in financing funds to UK start ups as the European Investment Fund is the largest investor in UK venture capital firms. After two years competing head-to-head with London, it is more than probable that Berlin will definitely gain the post of the StartUp's European capital.
Establishing a new legal framework for the digital relationships between UK and EU will require to deal with a diverse and large set of issues. Some of them, as mobile roaming charges, will attract a huge attention. However, other more subtle will have a bigger impact. It is the case of the new data protection regulation that will not enter into effective force due to Brexit. EU is discovering the complexity of achieving an agreement with the US for the free flow of personal data between the two blocks. A similar difficulty could emerge between EU and UK, that could be extended to other fields where a strong level of trust is required, as cibersecurity.
We have in front of us a two year period of negotiations to make effective the brexit. Whatever the final result, it will be a bad result. Europe (including UK) will lost another two years of work deaing with the ICT face of brexit while their digital competitors enlarge its advantage in this sector.