‘Virus crisis will magnify impact of a no-deal on companies’
BUSINESS leaders fear the virus crisis will magnify the impact of a no-deal Brexit, new research suggests.
The Institute of Directors (IoD) has warned of a potential “double hit” from Covid-19 and leaving the EU without a trade deal.
A survey of almost 1,000 company directors found only one in 10 does not believe the pandemic will magnify the impact of a no-deal Brexit on their organisation.
Just under half of respondents said they are not fully prepared for the end of the transition period, while nearly a quarter reported their company may not be ready in time.
Around one in four of those polled said they do not expect Brexit to affect their organisation.
Many directors said their company has built up cash reserves and plans to increase stockpiling, although the IoD said it is worrying some firms still need to obtain EU licences and authorisations.
Allie Renison, senior policy adviser at the IoD, said: “The prospect of no deal would be daunting enough, let alone dealing with it in the middle of a global pandemic.
“These disruptions won’t cancel each other out, if anything they would compound the pain for British businesses.
“When it comes to preparing for Brexit proper, directors’ hands have been tied by a number of constraints and competing pressures. Reacting to the pandemic has taken up so much of business leaders’ time and energy throughout the year. On top of this, much of the information companies need is still subject to negotiations.
The prospect of no
deal would be daunting enough,
let alone dealing with it in the middle of a global pandemic ALLIE RENISON, SENIOR POLICY ADVISER
AT THE IOD
“Brexit adjustments will further add to businesses’ cashflow challenges in the months ahead. The Government must look to how it can smooth that process.
“Financial support as seen in other countries, whether through vouchers to help access advice or through extending tax reliefs to facilitate that adjustment, would give small firms a much better chance of coping.”