The Institute of Directors has reiterated the importance of agreeing trade deals within the EU following Brexit, ahead of focusing on forging agreements further afield.
The warning was issued to the government by the IoD as international trade secretary, Liam Fox, looks to strike more trade deals with the rest of the world – a key benefit for Brexiteers in leaving the European Union.
With over 30,000 members, the IoD polled almost 800 company bosses and reported that the EU has provided stronger growth for exporting British firms than both North America and Asia since 2016, suggesting to ministers that trade needs to be boosted both with European neighbours and worldwide to achieve ambitions of creating a ‘global Britain’.
The research also showed that more British companies are exporting goods, up 7% over the last five years, despite the referendum result and invoking of Article 50.
Allie Renison of the IoD said: “Going global is as much about opportunities in Europe as it is further afield, and this should be reflected in how the government shapes post-Brexit Britain”, whilst also noting that ministers must ‘get real about trade, and fast’.
Despite business concerns over leaving the EU and single market, in particular, many company heads are optimistic over future trade prospects and international sales opportunities. One such study, carried out by HSBC, found that a third of firms surveyed predicted the outcome of Brexit would be positive for British business.
Head of commercial banking at HSBC, Amanda Murphy, suggested that firms are undeterred by future post-EU uncertainty and businesses ‘clearly aim to capitalise on the cheaper pound and rising demand in key markets’ to boost international sales.
Business beginning to shift focus to issues at home
And despite many questions still awaiting answers when it comes to business and Brexit, it appears UK forms have warmed enough to the prospect that attentions are flickering back to matters closer to home.
A survey by Deloitte which surveyed 106 company CFOs, including 25 of the FTSE 100, found that sluggish economic growth was now a bigger concern.
The CFOs assigned scored Brexit as a 56/100 risk towards their business, whilst weak demand at home scored 57/100.
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Eroding spending power of consumers at home due to an inflation spike, plus market concern as household names including Toys R Us and Maplin entered administration, are two of the key contributors, as well as weak productivity growth and potential labour shortages.
However, the economy has shown signs of recovery in Q1 2018 with wage growth, including through the National Minimum and Living Wage, whilst inflation eases.
In fact, the same survey found that one-fifth of companies felt more optimistic about future prospects than they did in Q4 2017.