Monday, 20 June 2016

British Business and the EU referendum.

This week is a huge one for Britain.  In light of the referendum this Thursday, we have a few words from our CEO, Dave Broadway, on the subject. 

"I have not heard the Leave campaign or the Remain campaign try to explain what will actually happen if we vote leave. Similarly the EU itself has no precedent to guide us by. It therefore seems obvious to me that if we do decide to leave, there will be a period of unravelling and negotiation before we actually know where we stand, what trade agreements we have reached, and so on.

What there is a precedent for is uncertainty. Whenever there is uncertainty, investment suffers. We saw that recently in our own postal market, Whistl were forced to withdraw from delivering post when their main investor pulled out because of uncertainty over regulation. Nobody want to risk their money when they are uncertain what market conditions will be, what regulations will apply, what issues there will be with imports and exports, and even to what extent markets like the EU will be open to us at all.

We are already seeing the pound falling, and capital (in the form of cash) moving out of the UK (according to the Bank of England). This can only get worse if we exit the EU. Even if, ultimately, we are better off out, the next few years would see no investment, and hence failing businesses.

So the choice is very simple. You can gamble on things being better at some point in the future, but facing a long period (who knows how long) of uncertainty and no investment. Or, we can stay in, and use this whole episode to force the EU to change to a more sustainable model, with a proper policy for dealing with immigration. That’s an easy choice for me."

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