Stephen Saint-Leger, Cambridge AssociatesThe British people have spoken—52% of them in favor of exiting the European Union—but some experts are expressing doubt that a full divorce will, in fact, take place.
“Brexit opens Pandora’s box,” wrote Stephen Saint-Leger, a Cambridge Associates managing director, after the results came out. “But beware of jumping to conclusions too soon.”
The referendum is only “advisory,” London-based Saint-Leger noted, “meaning that an act of Parliament will need to be passed to initiate the process of separation.” If enough lawmakers fail to join pro-Brexit Conservative members of Parliament and pass the act with a majority, “there is scope for chaotic scenes.”
Another voice of caution came from Investec’s Philip Saunders, co-head of its multi-asset growth fund. “Will ‘out be out’?” Saunders wrote as his first point in a statement following the vote.
“Uncertainty will continue with the possibility of a further referendum. The actual exit process will not start until Article 50 of the Treaty on European Union is triggered,” he continued.
Cambridge’s Saint-Leger echoed the possibility of a second referendum “if popular opinion turns during the UK-EU trade negotiations.”
Saint-Lager and Saunders are in the minority among financial firms’ and experts’ official positions. Even Cerulli Associates, for example—which titled its analysis “A Storm in a Teacup”—assumed Brexit from the opening sentence: “Britain exiting the European Union…”