Brexit - the Voices of European Business
14 September 2017
Jurisdictions: Spain, The Netherlands, Belgium, Hungary, Germany, Frankfurt, Hamburg, United Kingdom, Luxembourg, Madrid, Italy, Russia, Munich, France, Rome, Poland, Croatia
In the common interest: business perspectives on priorities for a Brexit that secures prosperity for Europe
The Council of British Chambers of Commerce in Europe (COBCOE) has published a report, which gives voice to business operating in Continental Europe. The report, Brexit – the Voices of European Business, identifies key areas of common interest and also sets out priorities for a Brexit that secures prosperity for Europe.
It's clear that business leaders across Europe are concerned by Brexit. Uncertainty about the process and outcome of Brexit negotiations, coupled with a potentially short timeframe for change, is already impacting investment and commercial decisions. Managing the risk that this uncertainty presents is also a drag on productivity, while wider policy progress, such as development of the digital economy, could be delayed by the focus on Brexit.
The research uncovered fear that the UK would be partitioned off – even among European companies not directly engaged in trade with the UK. Many European businesses value the UK for its financial markets, regulatory infrastructure, and world-class research and development. The UK acts as a gateway for international investment and is considered to be a business-friendly force within the EU.
Barriers to trade
The highly interdependent and interconnected nature of European markets is a success story of the modern economy, bringing prosperity and jobs to millions of people. This success should not be taken for granted; it depends on the frictionless trade made possible by European economic integration. Partitioning off the UK from the European market – by introducing tariff, border, and regulatory barriers – threatens the competitiveness of businesses across Europe.
Uncertainty and disruption in the Brexit process
Uncertainty about the future is already impacting European businesses and their decision-making now. Our evidence suggests widespread delay in investment decisions, as management remains cautious about making commitments that might later turn out to have been premature, unnecessary, or inappropriate. Managing the risk that uncertainty presents is also of itself a drag on productivity, with management time and resources diverted. Businesses need predictability to plan, even if that is predictability about the interim period between the present and the future destination. Without predictability sooner rather than later, businesses may have no choice but to implement contingencies for the worst-case scenario. This gives rise to cost and inefficiency.
The UK's role as Europe's global springboard
European business value the UK as an important part of the European economy. It is admired for the liquidity and depth of its financial markets, the strength and openness of its regulatory infrastructure, and the quality of its research and development (R&D) capabilities. Many see the UK as being of enduring importance to the continued success of Europe as a whole, both as a gateway for international investment and a springboard for access to global markets. Business leaders are clear: continued collaboration must not be sacrificed.
The research for the project, which has been supported by Hogan Lovells, included 27 structured roundtable discussions in 18 countries, a survey which identified main concerns, and a poll amongst the participants.
Read the full report