“Brexit has had more dates in the last year than I have” has been a popular quip on Twitter today following the EU’s announcement that member states have agreed to a new extension period.
The UK now has a deadline of 31st January to agree to a deal in Parliament. Just to add further intrigue, the deal is flexible and allows for Brexit to happen before that date should an agreement be reached. Entering a new term into the Brexit dictionary – ‘flextension’.
It’s a blow for Boris Johnson who’s primary message during his leadership battle focused on ‘getting Brexit done’ by the 31st October – no ifs or buts. And whilst his amendments to Theresa May’s deal, predominantly on arrangements on the Irish border, did garner enough support in Parliament to grant a second reading, the rejection of MPs to assess the new text in just three days has lead the UK to another position of uncertainty and, the word of the day – delay.
But is today’s news good or bad for British businesses?
The good news
The good news for UK firms is that a no-deal Brexit by the end of this week won’t be happening. Huge employers, particularly in the manufacturing sector, have been unified in their belief that a no-deal or ‘crash out’ exit from the European Union would be disastrous, cut jobs and result in further operational relocation onto the continent.
The delay also affords a further opportunity for SMEs who are still unprepared for an EU departure, whether on good grounds or not, to put some plans in place to deal with whichever eventuality comes from what will be by next year a near-four-year process.
It’s also worth noting that for many companies, Christmas is a critical trading period for which any disruption, including an agreed exit, would have proved extremely poor timing.
The bad news
What many business leaders have publically commented in the last few years is that it is uncertainty and not Brexit itself which is really harming UK business.
And for those businesses who have seen investment dried up or the firms who have growth plans stuck on pause, the wait for a clear and verified path forwards goes on.
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Ongoing delay also proves another blow to organisations who have invested millions in stockpiling goods and critical components who will now need to decide whether to continue paying to store them, start using them and buy further stocks next year or, indeed, try to get rid of what may now have gone out of date where perishables are concerned.
But for now, it’s as you were for UK businesses, and trade goes on.