Approaching a cliff edge? British business begs for clarity after Brexit maelstrom
LONDON: After the maelstrom of Prime Minister Theresa May’s election crisis and a struggle in government over the shape of Brexit, business chiefs have a simple request for Britain: Give clarity on how the EU divorce might look.
Since May nearly lost her job in a botched June 8 election gamble, ministers have sought to strike a more inclusive tone, even inviting in some chief executives to a 17th century manor house to discuss Brexit over a buffet lunch.
But as the March 2019 exit date approaches, six major British business chiefs told Reuters they still do not have the answers about post-Brexit immigration, trade and regulation they need to plan and make coherent investment decisions.
“I see through a glass darkly. It’s hard to discern exactly what is happening at the moment,” Rupert Soames, CEO of British outsourcing group Serco, said.
Serco was finding it harder to attract truck drivers in its waste collection business in Britain because of a lack of clarity about Brexit, he said.
Many were opting instead to work in Spain, Italy or Portugal.
“There has been a bit of a thaw in Number 10, but nothing dramatic,” said a FTSE 100 company senior executive who asked not to be named due to the sensitivity of Brexit.
“Before the election, they weren’t listening. Now, they’re trying to listen, but they have very little of substance to say on the topic that matters far more than any other,” the executive said.
Some business chiefs also said they were disorientated by a public battle at the heart of government over the shape of the divorce, including crucial details such as immigration controls and the length of any possible Brexit transition.
While the stakes are high, time is short.
Britain has less than two years to negotiate the terms of the divorce and the outlines of the future relationship before it is due to leave in late March 2019, though a transition could give businesses more time to adjust to the new relationship.
Still, many business chiefs worry that there is ample room for a breakdown in talks and a disorderly Brexit that would imperil Britain’s US$2.5 trillion economy by sowing chaos through the labour market and trade flows.
The EU and Britain need to reach agreement on everything from expatriate rights to the complexities of customs to keep trade flowing between the world’s biggest trading bloc and the fifth largest global economy.
FTSE-100 executives said they understood ministers could not give an exact outline while negotiations were under way.
But businesses did need to understand the rights of EU workers and how trade would work the day after March 29, 2019.
May wants to negotiate the divorce and the future trading relationship with the EU before Britain leaves, followed by what she calls a phased implementation process to give business time to prepare for the impact of the divorce.
Britain’s pharmaceutical industry needs at least two years’ transition to cope with the impact of Brexit, said Emma Walmsley, the chief executive of GlaxoSmithKline. — Reuters