Brexit: how will it affect your business?
Following the announcement of Brexit, the pound sterling dropped substantially as did many peoples faces. At the time of the referendum result, the impact on the UK was significant with companies threatening to leave the UK and a worsening lack of skills projected for the future.
It was expected back then that the market would stabilise by 2019 and that the British public, as well as the rest of the EU, would understand exactly how Britain leaving the EU would work and how it would affect not only the economy but also trade agreements and business relationships.
From referendum to reality
Two years on, and with the Brexit deadline quickly approaching, we are not any clearer on what Brexit really means; especially when it comes to conducting business with foreign companies.
The potential negative effect of Britain leaving the EU will not just be felt by the Brits. The Netherlands, Ireland and Belgium are the most vulnerable should a no Brexit deal occur as they are heavily dependent on export from the UK.
So far, it is clear that with the uncertainty, comes another negative effect on our beloved pound sterling. But the weaker pound has provided an opportunity for British products as they are now more affordable and more competitive; 6.8% year-on-year increase in February 2018. The flip side to this however, is that EU exports to the UK have stagnated with only 0.9% growth.
But what has been the real impact on Britain’s relationships with foreign companies? For now, it is business as usual whilst we let the governments hash out the details however, the future is still very uncertain. Should Theresa May get the backing from the EU for her proposed Chequers plan then the future could be brighter than we think. May is proposing that a lot of rules on goods will be similar to those of the EU. And is hopeful the UK and EU will act as a ‘combined customs territory’ to avoid a physical border with the Republic of Ireland.
Movement of people will end allowing the UK control once more on who can enter the country, but May has proposed a ‘mobility framework’ which will still allow citizens of the UK and EU to travel to each other’s countries, study and apply for work.
The end is nigh?
On 25th November, there is a planned EU summit to agree the final version of the plan which includes a 21 month ‘transition’ period to allow for a smooth exit of Britain from the EU. However, following the agreement of the text on 14th November by the UK government, MP’s have been resigning and rumours of calling for a confident vote are rising.
Theresa May is confident in her plan and is continuing to push it however, we could very easily end up with no deal and then it’s anyone’s guess what will happen!
We certainly do not have a crystal ball and do not guarantee you will feel no effect post Brexit however, we can help you to mitigate as much risk as possible. We specialise in cross border transactions and would highly advise you seek expert advice on how you can best safeguard against the implications of Brexit.
Our initial advice? Keep calm, keep a stiff upper lip and get in touch with us today!