Brexit: “Hope for the best, assume the worst”
As the EU referendum draws ever closer, businesses of all sizes continue to speculate how a potential Brexit would affect the UK economy. Foenix Partners, an FX boutique, has provided the following round-up of views from its community of mid cap and SME UK businesses:
Foenx Partners MD Richard de Meo: “Foreign exchange discussions tend to be forward looking and I haven’t spoken to any company that hasn’t adapted their view or their strategy as a result of the upcoming uncertainty. For me, the key themes are:
- there is a unanimous craving for actual information about how an exit would play out. In the absence of reliable scenario analysis, decisions will be driven by fear and an ‘in’ vote remains the more likely
- there continues to be a divergence in personal versus business view, with a significantly higher proportion of personal views in favour an exit. In these cases their position is based on immigration and protection of sovereignty. The more impassioned views reference their desire to avoid unelected European forces dictating domestic policy.
- a worrying number of UK companies are very exposed to sterling losses yet are not hedging their risk at current deflated levels in the hope and expectation that sterling will rebound on the back of an ‘in’ vote. A Brexit and the inevitable sterling losses would have serious and widespread consequences for the UK’s community of importers – in particular the retail and travel sectors.”
Senior Sales Trader Alex Lydall: “A notable sense of reluctance towards the referendum even taking place is evident, with a number of people citing an element of disbelief that the referendum will actually occur. In these cases people have been surprised that from a business perspective anyone can contemplate the idea of leaving. The increase in ‘red tape’, stress on supplier relationships and also the unknown time period and unforeseen business problems we are yet to know about were of particular concern – especially for those with large European offices.”
Senior Sales Trader Tom Floyd: “What is becoming increasingly clear is how personal views are somewhat clouding business decisions. The debate is far more balanced than could have been predicted as evidenced by various polls. For now, uncertainty is the only certainty and no matter how strong one’s personal views are, from a business perspective having the ability to adapt to the possibility of an exit will remain key. Hope for the best, assume the worst.”
The economic case against Brexit is stacking up fast...https://t.co/uK1TTROmJc— InFacts (@InFactsOrg) 23 March 2016
UK and China to team up over Northern Powerhouse
Communities Secretary Greg Clark welcomed a senior delegation of Chinese regional leaders to an historic summit recently to highlight investment opportunities across the Northern Powerhouse and promote stronger UK-China regional collaboration.
The summit, the first of its kind on UK soil, also offered the chance to showcase the government’s historic devolution revolution which is empowering local leaders across the country.
The Northern Powerhouse represents almost a fifth of the UK economy. Ministers want to build on this and therefore are supporting local leaders from the great northern cities to engage with international partners and attract inward investment.
To this end, Mr Clark and ministers from several Whitehall departments met with leaders from Chinese regional government along the Yangtze regional economic belt.
The Chinese delegation will head to Sheffield for a series of discussions with their UK counterparts from across the Northern Powerhouse about the opportunities for collaboration and investment.
The official delegation will hear from UK experts on sustainability, integrated transport planning, primary healthcare and the creative industries.
Communities Secretary Greg Clark said: “The UK is already Europe’s second largest exporter of goods and services to China – this week offered the chance to build on that success.
“The UK-China Regional Leaders Summit will take senior Chinese regional leaders out of London to see for themselves the wealth of expertise and experience that businesses and local government across the Northern Powerhouse have to offer.”