Last week saw Britain announcing at long last the schedule for Brexit – to start before April next and end in 2019. Latest trade figures (July) show that four out of Britain’s five top export destinations were EU member nations. The Chancellor of the Exchequer also warned in Birmingham that business confidence would be on “a bit of a roller coaster” during the negotiations. And the International Monetary Fund has reiterated its sombre view of the consequences of Brexit for world economic growth.
May reassures business
British Prime Minister Therese May laid out the UK government’s plans for exiting the European union at the Conservative party conference on 2 October : the process would start in earnest no later than end March and would be completed in 2019. She had appeasing words for Britain’s European partners : “we are close friends, allies and trading partners with our European neighbours” yet recognized “there is a lot of speculation about what that is going to mean, about the nature of our relationship with Europe in future, and about the terms on which British and European businesses will trade with one another.” Business concerns at great changes in their regulatory environment were laid to rest : “As we repeal the European Communities Act, we will convert the ‘acquis’ – that is, the body of existing EU law – into British law (…) by converting the acquis into British law, we will give businesses and workers maximum certainty as we leave the European Union. The same rules and laws will apply to them after Brexit as they did before.”
Great emphasis was placed in the address, on the concerns of business – which had for the most part, expressed concern before the “Leave” vote on June 23. She mentioned Apple and Siemens as firms that had not been put off investing in Britain by Brexit, and attempted to enthuse the audience with the prospect of Britain being “global” and a champion of free trade again.
But what this can’t have fallen on deaf ears : “existing workers rights [are] guaranteed” – contrary to the concerns that Britain’s EU-national labour force will have to pack their bags and leave any time soon.
According to government statistics, at latest count, the five top destinations for British exports (HM Customs, July 2016) were : the United States (£ 3.4 bn), Germany (2.6), the Netherlands( 1.9), France (1.5) and Italy (1.4).
Another bad day for Sterling
Chancellor of the Exchequer Phillip Hammond did warn at the Tory Party conference in Birmingham, that business confidence would be “on a bit of roller coaster” during the negotiations. The International Monetary Fund’s latest (October) World Economic Outlook has reconfirmed its early predictions of a negative impact of Brexit on the world economy. The Federal Reserve’s Janet Yellen has also sounded precautionary in her announcements.
The day after the PM and Chancellor’s speeches, Sterling fell to below 1.14€, which means the UK’s GDP slips to 6the place worldwide, behind France. EU and British traders may be reassured, but financial markets were evidently shocked. Join Europages to be on the map of business to business UK-Europe trade.
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Europages 20 July account of Euler Hermes’ report “Brexit: what consequences for European businesses?”
BBC 3 October, “Theresa May’s Conservative conference speech: Key quotes”