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Analysis

Businesses slipping beyond event horizon for Brexit damage

by Luke Lythgoe | 08.02.2019

Theresa May’s tactic of running down the clock in a bid to pass her Brexit deal is not just reckless because it risks economic chaos after March 29. The damage is already happening, and will only get worse as the Article 50 deadline approaches. Here are five recent examples of the impact of Brexit uncertainty.

50 days to Brexit chaos? Try nine

At least that’s the case for British exporters to east Asia which could see their goods sitting in quarantine and not being paid for unless a Brexit deal is struck soon, reports Bloomberg. That’s because any goods shipped after February 15 will arrive at their destinations after March 29 – with no idea what tariff regimes they will be under when they set off. This deadline is literally the day after the next set of Brexit votes in the House of Commons.

Worst economic growth since 2009

The UK now faces its weakest growth in a decade, the Bank of England said yesterday. What’s more, there is now a one in four chance of recession in the second half of the year. The Bank’s governor, Mark Carney, blamed the “fog of Brexit”. Before the Brexit vote we were one of the fastest growing advanced economies in the world, but now investors are reluctant to put their money in the UK.

Demand a vote on the Brexit deal

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House building slowdown

House building dropped sharply in London and the Midlands last year, down 10% on the previous year. Although the overall number of new homes completed nationwide still grew by 1% last year, the government target of 300,000 new homes a year by 2023 is moving further away. And don’t forget, the housing shortage was one of the main arguments Vote Leave made for Brexit back in 2016 – in reality, it is making things worse.

Stockpiling bonanza

Organisations of all shapes and sizes are spending millions of pounds stockpiling for “no deal” shortages. That ranges from hospitals stockpiling medical supplies to families stockpiling food. Brompton have stockpiled £1 million of bike parts. Heathrow is stockpiling rubber gloves so it can continue to security search passengers after a no-deal Brexit. Factories are stockpiling at their fastest rate in 27 years, while warehouse space in the UK is rapidly reaching capacity.

Nissan backtracks on X Trail

Worrying news for the people of North East as the Japanese car giant reversed its promise to the government to build its new X Trail model in Sunderland, citing “continued uncertainty” around Brexit. Of course, the bigger promise that was broken was the government’s pledge in 2016 that Nissan would not be “adversely affected” by the UK leaving the EU.

We talk about March 29 as the Brexit deadline, but many businesses are already beyond it. Backing the government’s deal isn’t the answer. May’s proposal – indeed any other form of Brexit – would see uncertainty and infighting continue for years, as I argued yesterday. The only way to avoid both the abyss and years of sapping uncertainty is a People’s Vote.

Edited by Hugo Dixon

2 Responses to “Businesses slipping beyond event horizon for Brexit damage”

  • Redoubling our fight to remain in the EU is essential, but the only problem is that we are severely outgunned. The significant statistic about Brexit is that despite being unmitigated twaddle and a piece of criminal insanity, almost half the population still believe in it. That is, in large measure, testament to the success of the Brextremist propaganda machine – our rightwing press.

    Who do we have on our side? A few publications with a relatively small and select readership; the Guardian, the Independent. A public broadcaster totally obsessed with “balance”. Captains of industry that remain silent when they should be speaking out. Members of parliament who should be doing what they know is right but who cower instead like frightened rabbits before the will of the people.

    Pro-europeans bravely mount a march here, a protest there, but they have nothing to match the enormous influence of the Brexit press cartel and rightwing media. It is truly a David and Goliath struggle that we face.

    All the same, Remainers have hung back long enough, and time has run out. We may lose, but it is best to go own fighting.

  • Guardian Headline: “Back May’s deal, then hold a people’s vote: plan to end Brexit deadlock”. I quote from The Guardian from today:

    “Theresa May could win parliament’s approval for her controversial Brexit deal in return for guaranteeing another referendum, under a new plan being drawn up by a cross-party group of MPs. The new vote would give the British people a simple choice: to confirm the decision or stay in the EU.”

    This sounds like a very clever idea. At a stroke, I can see that the following will have been achieved:
    – A “People’s Vote” will take place, via an agreement with the EU to allow Article 50 to be delayed, long enough for the second referendum;
    – Theresa May gets her Brexit bill through, albeit conditional upon the outcome of the referendum;
    – The politicians of both main parties will not have to prevaricate (i.e. continue to pratt around) any more about what they will do or not do next;
    – The Brexiteers can’t do anything about the situation – they simply need to get on with fighting a new media battle leading up to the new referendum.

    The only main thing which now needs to happen, and one which I would like to see as part of the cross-party amendment, is to enshrine in law the requirement for Citizens Assemblies to be set up across the UK, with funding from Government to assist in this process.

    As I have read in several articles about Citizen’s Assemblies potency, they becoming the focus for discussing and disseminating issues and information accurately and honestly from ordinary people to ordinary people. Furthermore, through their dialogue to a great extent, the right-wing press becomes emasculated. For once, they will need to report on what the ordinary person thinks not what they believe we should think!

    This outcome speaks volumes for the selfish political behaviour of Theresa May and Jeremy Corbyn, whose leadership will have been bypassed. Any intelligent media reporters should then be interrogating both by asking “Why didn’t you do this in the first place?”

    This week should prove to be another exciting one!