UK Prime Minister Theresa May is set to form a coalition government after her Conservative Party’s failure to win a majority in Parliament which will have a serious impact on Brexit.

According to the Thai Commerce Ministry, which closely monitored the UK election results, the poll setback for the ruling party meant negotiations to exit the European Union could be negatively affected. There is also a short-term impact on the value of the pound as well as increased worries in international financial markets due to uncertainties now hovering over Brexit.

UK premier May is due to visit Queen Elizabeth II shortly to seek permission to form a coalition government.

Pimchanok Vonkorpon, director-general of the Commerce Ministry’s Trade Policy and Strategy Office, said preliminary election results show that the Conservative Party had won 313 seats of the 650-seat UK Parliament, a drop of 331 seats from the previous 2015 poll. This means the UK will be ruled by a coalition government whose mandate would be less clear as crucial talks in the country’s departure from the EU near.

Pimchanok said that immediately there would not be any significant impact on UK trade with Thailand since the British government would continue to follow the EU’s rules and regulations until it leaves the group. However, the UK is expected to speed up negotiations with other trading partners, including Thailand, for bilateral and multilateral agreements on trade and investment.

Brexit is expected to create new opportunities to increase trade and investment between the two countries, especially for Thai exports of sugar, chicken and rice to the UK market which are expected to increase due to the absence of quotas which are imposed on EU member countries.

On the investment side, Thailand expects to see more business partnerships with the UK in various sectors, especially information technology and aviation, as the UK is currently ranked Thailand’s 18 largest trading partner.

In the first four months of this year, bilateral trade amounted to US$2.16 billion, with key Thai export products being processed chicken, automotive parts and components, aviation parts and components, electronics and jewellery.

The UK premier’s snap election was intended to boost her mandate for the Brexit negotiations, but the move backfired despite the party’s earlier lead.

According to an analysis by Kasikorn Bank’s financial markets, the Conservative Party, which still won the most seats but was short of a majority, would have to govern with the backing of other smaller parties.

The last time the Conservative Party had to form a coalition was in 2010, when the Tories and Liberal Democrats joined forces, but that government only lasted for eight months before there was a new election.

Given the election results, Brexit negotiations are likely to be delayed as negotiations were expected to start on June 19. Overall, the new UK government will likely face many obstacles in Parliament as the UK needs a strong negotiator backed by the majority of MPs.

On the other hand, if May failed to form a coalition government and the Labour Party’s leader, Jeremy Corbyn is picked as the new prime minister, financial markets would expect to see a case for a “softer” Brexit.

Based on the election results, it seems UK voters had changed their minds to “Bremain” in the EU as a significant number had turned their back on May and ended up choosing the Labour Party instead, especially in London.