In the run-up to the Brexit vote those wishing to get out of the EU protested against the UK government’s ‘Project Fear’ campaign – a litany of disasters and black holes that they said would inevitably overwhelm the British economy.
While it is true that many greedy currency traders worldwide spied a weak spot in the Pound Sterling, resulting in a 20% fall in its current value, the vast majority of the much-forecast problems are never likely to occur.
First, in spite of the endless threats from EU officials and outgoing national leaders such as Angela Merkel, a cold, hard look at circumstances demonstrates one thing: it is the UK that holds all the cards.
One of the least likely doom scenarios involved Nissan, which exports huge numbers of cars to the EU. Its leaders had expressed fears it will be ‘locked out’ of the Single Market and it was no surprise to me that the company agreed to expand its operations in Sunderland after assurances that the UK government was committed to securing continued tariff-free access to EU markets. It shows that business holds the trump card as we plan for a post-Brexit world.
In addition, what is the likelihood that the 750,000 jobs in south Germany that depend on exports of Mercedes and BMW cars to the UK will be jeopardised by a block on the trade by any future German government? Near zero, one can predict.
Most recently, the youthful ‘fintech’ sector in London has been screaming incessantly that Brexit and ‘the future ban on foreign workers’ will crucify their companies. This is nonsense. Under Brexit the UK will most likely propose a visa system on essential workers in exactly the same way that skilled workers are selected in nearly all of the world’s advanced nations: the US, Australia and Canada.
As there are only 3,000 companies in London’s fintech community the only limitation will be on their foreign staff’s access to future benefits, pensions and free healthcare. Finally, their threat to move their companies to Paris and Frankfurt rings hollow. Most obviously, all of the clients are located in London, and very few in Europe, which is why the sector first grew up in London in the first place.
Overall, what pro-EU organisations such as the EFF and the CBI don’t seem to realise is that around half of British engineering and manufacturing is already owned by foreign companies. Most are highly profitable. In total foreign firms own more than £120bn in UK-based industrial assets. Giving them up on the command of some EU politician is unthinkable.
Above all, all of world’s high growth markets for UK exports in the future lie outside the EU – in the Middle East, South Asia, Australasia and North America. These are the places where JCB excavators, Rolls-Royce cars, Glaxo’s Hepatitis C and Aids vaccines, and much more, are most highly prized.
By contrast, doing business in the EU since the UK joined in 1974 has been little more than a nightmare. Our total trade deficit with EU nations since we joined now stands at more than £300bn, or the equivalent of one third of our national debt.
We buy much from them; they buy little from us. The UK and Netherlands are the only truly open markets in Europe. All others are protected by stiff regulations, language restrictions, city obstructiveness, and often ferociously backed by substantial secret subsidies. Ever tried buying a German football club; tried getting a contract with a French engineering company; tried opening a hotel in southern Italy? Forget it: the barriers are insurmountable.
The best aspect about Brexit is the way in which it will encourage – or even force – British exporters to re-discover their true markets in our traditional regions of the world.
Some of the best and most entrepreneurial businessmen in Britain supported Brexit. These include Tim Martin, of pub chain Wetherspoon’s; boss of Staffordshire digger firm JCB and Tory donor Lord Anthony Bamford, and home appliances pioneer Sir James Dyson.
Export markets and opportunities for our SMEs will boom – as never before. In fact, they are already. The British Hovercraft Company reported plenty of fresh interest its sports craft when interested buyers from leisure parks in the US and Brazil realised they would not now be subject to heavy EU tariffs.
Pro-EU organisations such as the EFF and the CBI have little knowledge of the tens of thousands of fast-growing SMEs which are logged and monitored in our 58,000-SME database, the Gibson Index, which has investigated ground-floor developments in the UK economy since 2001.
At most overseas trade shows the excellence, sophistication and originality of UK SMEs never ceases to astonish. Years ago it was a Scottish security firm whose software tracked down the Washington Sniper when the FBI didn’t have a clue where to look.
Another firm, Subacoustech, near Portsmouth, undertook all the difficult development work for the US Navy’s high energy gun. Lastly, let’s remember that all of the legal and regulatory work for the Euro 20 years ago was executed by professional services firms not in Frankfurt but the City of London.
In little more than two years time – when the UK exits the EU, and with the trade threats from EU leaders ringing in their ears – many British people will wonder why we didn’t leave the club many years earlier.