Citizens of the United Kingdom voted 52% to 48% Thursday in a referendum dubbed "Brexit" for Britain to exit the European Union.
Here are four reasons why Americans have a stake in the results:
Weakening of America's largest trading partner
The EU is the most lucrative market for American goods, as it is the largest trading partner for the United States.An exit by Great Britain signals a diminishment of the 28-nation bloc, undermining that economic bulwark. A matrix of trade agreements between the EU and the U.S. would be complicated and negotiated adjustments would be necessary. Total U.S. investment in the EU is three times higher than in all of Asia, and Britain is the top country in the EU for American investments. A survey in March of American companies showed that 95% favored Britain remaining in the EU and President Obama urged the same.
Stocks around the world plunged on the news because of uncertainty over what comes next and the prospect of an economic slowdown in the U.K. The result could reduce the value of Americans' 401(k) investments and individual retirement accounts. Volatile gyrations in markets worldwide could continue. "Uncertainty is the enemy of investment," said analyst Alastair George.
Loss of national security benefits
As a strong ally of the U.S., Britain provides valuable information to American intelligence agencies about the inner workings of the EU, a benefit that will be lost once Britain leaves the EU. The British are "our window into the European Union," said retired general Wesley Clark, former NATO commander. Moreover, the EU would lose a strong ally in the U.K. for EU security actions favored by the U.S., such as sanctions on Russia for its incursions into Ukraine.
Bruised U.S. exports
Several research studies argue that the U.K. — one of the few bright spots in a fragile worldwide economy — could suffer financially by leaving the EU. One major consultancy group, Capital Economics, estimates a British GDP reduction of 2.2%. Slower global growth is not good for the U.S. What's more, a sharp drop in the value of the British pound against an already strong dollar on Friday dollar makes U.S. exports more expensive, reducing foreign sales.