The effect of Brexit on UK Market Prospects
The vote for the British exit from the EU was one of the largest economic decisions of 2016. So how will this affect business prospecting in the UK?
Many businesses planning to expand into the UK market may be wondering what the repercussions and effects will be in the short and longer term.
Estimated reading time: 2 minutes
What are the changes to business prospecting?
One of the prime advantages of Brexit is that it will permit the economy to reboot and start up again. The UK is currently developing self-governing economic policies impartial from EU policies. Also, restrictions that may enable it to bargain better terms and conditions. After Brexit, the UK will have the independence to seek new trade deals all over the world.
Positives and negatives
There are many benefits of the weakening British Pound. Beside its negative effects on the British economy. It reduces the cost of producing goods and services. Therefore this makes it possible for the UK’s exporters to compete in the international market. This is through cheaper products in conjunction with enhanced profit margins. Also, it may help in revitalizing the industrial sector of the country. It’s apparent that as the FTSE 100 is still one of the best performers amongst the world’s leading stock markets (even immediately after the UK voted to leave the EU), the UK market has sustained investors’ trust. As well as looking to continue to be a safe place for businesses compared to an arguably crumbling Europe.
There has been no change in the fundamental economic drivers of the UK’s economy. As many sectors are not directly affected by it. As mentioned, Brexit will also help reduce the countries rules and regulations, specifically for SME’s (which make up the vast majority of businesses in the UK). Also, allow for improved profitability at the same time as catching the attention of potential investors.
The UK has framed aggressive policies for regaining control over its trade and investment agreements and is working to enrich the countries’ collaboration within the commonwealth. It has lowered the rate of corporate taxes to encourage investment in the economy. Also, as others may be hesitating during this time of uncertainty, there is still a very valid opportunity for companies from abroad to act now and establish a solid market position in the UK.