Confidence in economy waning, survey shows
BUSINESS LEADERS’ confidence in the British economy has plummeted, as uncertainty about Brexit continues ahead of the March 29 withdrawal date, according to a new survey.
The cautious optimism shown by company bosses earlier in 2018 has entirely gone, the survey by the Institute of Directors (IoD) found.
Overall optimism, which had briefly reached positive territory following the initial agreement of a Brexit transition period, has fallen steadily since April and hit its lowest point in December. All regions and nations of the UK are now reporting a pessimistic outlook for the 12 months ahead, the IoD’s survey results show.
Its findings are based on 724 total respondents, with work conducted between December 5 and 20. The main concerns highlighted by IoD members were general economic conditions, the trading relationship with the EU and skills shortages.
Tej Parikh, a senior economist at the IoD, said: “Business leaders are looking ahead to the new year with trepidation about the economy. While we saw cautious optimism emerging when the Brexit talks appeared to be moving towards a transition period after March 2019, that has utterly dissipated now.
“There can be no doubt that the tumultuous Brexit process is having a damaging impact on firms’ outlooks. The prospect of a no-deal in the near future will be weighing heavily on directors’ minds.”
The findings indicated that a just seven per cent of business leaders expected to invest more in the next year, amid a lack of clarity over a Brexit deal.
Mr Parikh added: “Uncertainty is already causing businesses to delay investment, hiring decisions and product launches, which also acts to weaken our international competitiveness further down the line. The longer this state of affairs continues, the more we lose by it, even if these effects aren’t apparent in the here-and-now.”
A LOGISTICS expert has called on the Government to provide Yorkshire’s exporters to the European Union with more certainty over arrangements following the UK’s departure from the bloc.
Adam Johnson, director of Leeds-based Tudor International Freight, said his organisation, its customers and other affected Yorkshire businesses were becoming frustrated at the country’s politicians delaying crucial decisions around Brexit with the UK due to leave the EU on March 29.
He said: “We’ve had the postponement of the so-called Commons meaningful vote on the withdrawal agreement negotiated by the Prime Minister with the EU, because it would have been rejected, which would, at least, have allowed one option to be eliminated.
“That was followed by Mrs May visiting various EU capitals and attending the Brussels summit, in a bid to secure concessions making her deal more palatable to MPs, which seem to have yielded little.
“We’ve also had the distraction of an abortive attempt to topple the Prime Minister by some Conservative MPs, which, even if successful, would have been unlikely to change much in the Brexit picture.”
Mr Johnson said it seems to him that the meaningful vote was pushed back to the New Year because Mrs May was still hoping for something to turn up which would enable her deal to be passed.
He added: “Business is, rightly, usually very reluctant to intervene in politics. That’s why my own organisation expressed no preference in the approach to the 2016 referendum for remain or leave.
“This also explains why we haven’t advocated a particular form of Brexit since then, other than to endorse the widespread view among companies that a ‘no-deal’ departure would be highly undesirable for our economy. What business does have a right to expect from politicians, at this late stage, however, is a high degree of certainty, and that’s still lacking.
“Companies are usually capable of adapting to changing circumstances – they have to be – but they do need time to plan properly for significant alterations like our departure from the EU.”
Tudor International Freight employs 25 staff.
Business have a right to expect a high degree of certainty.
Adam Johnson, director of Leeds-based Tudor International Freight