What does Brexit mean for British Business going forward?
Brexit being the separation of the UK from the European Union is probably one of the biggest constitutional alterations for generations . With so much legislation, investment and institutional collaboration sewn up in EU projects the overall effect will no doubt lead to disruption. Businesses rely on an element of harmony to be able to focus on the matter of running their companies and unable to fully predict the future (to an extent) things like investments, particularly in unpredictable markets will lead to businesses hesitating and holding back were they would have once gone forward.
Looking beyond the initial problems of the process of Brexit, leaving the European Union has many positives. Due to EU trade negotiation, Britain has had to negotiate all overseas deals as part of a legally enforced coalition of EU countries which has led to compromise in order to aid the EU as a whole. With such a potential burden removed along with the likes of the Common Agricultural Policy , Britain is now in a position to create deals with countries such as the USA and South Korea, also possibly renewing its commonwealth ties internationally, meaning it can tailor its position to maximise the efficiency of its global trade advantages.
Some of the disadvantages of leaving the EU will be the funding to areas that would, or could have been neglected due to politics. Liverpool saw a mass of investment in the running to 2008 and beyond with the European Capital of culture which could be argued would not have materialised if it wasn’t for the EU project as a whole. I’ve previously worked for Liverpool John Moores University and I have seen first-hand the mechanisms and projects set up by the EU which not only draws investment from across the continent but collaborations with other EU universities. Now whether this is an effect of the UK joining the EU is hard to put down as we haven’t run the two models parallel at the same time (obviously that would be impossible) and so in an EU vacuum it could be argued the UK government would have introduced such mechanisms anyway as it does beyond the EU e.g.: students from outside the EU, to ensure the high standards and therefore economic benefits that come with that.
Looking at the reactions of leaving the EU the division of those who wish to remain and wish to leave seems to cross cultural and economic boundaries prevalent in the UK. In a way by leaving the EU it has emphasised these differences but what light does this shed on the effect on business?
One of the boundaries is said to be a class and personal wealth. With more working-class people voting to leave the EU and more middle-class people voting to stay. London by and large voted to remain in the EU. Also, people more effected by the institutions intertwined with EU funding (universities) voted to remain. This gap possibly highlights the flaws in the Eu project amongst the poorer sections of society which hasn’t financially benefited and/or culturally benefited from the EU . The government, I suspect must now politically plug that gap or at least now be aware of the economic problem which may affect the future policy to funding projects in these areas. This may translate to greater funding for local businesses, or it may not.
As a whole I believe (and speculation is all we have without precedent) that the government will basically copy all EU legislation (especially regarding business) into UK law in order to keep disruption to a minimum. This will safeguard hopefully investment in the future in and out of the UK and therefore trade.
The only similar precedent culturally and regarding trade would be when the UK (along with the northern European countries split from the catholic church in the 16th century, the catholic church being the richest and most powerful political force in Europe at the time . Such a major act did eventually lead to the explosion of ideas which eventually saw Britain leading the world with the industrial revolution. To compare the two though is impossible in their detail as the world was a much different place 500 years ago, so such a comparison must be taken lightly. The psychological effects of independence mustn’t be overlooked when considering a cross European project hasn’t been fully completed since the Roman Empire. And sometimes just approaching a business problem from a completely different direction with fresh thinking can give either a business or a country a competitive edge in any market. Be that on a global scale or a local scale.
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