Brexit and its Impact on UK Business: An Overview

This article provides an overview of the impact of Brexit on UK business. It covers the current situation, possible options, and the effects on the economy, unemployment, business, and the British pound. It concludes with recommendations for businesses.

Running head: MANAGEMENT
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Name of the student
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Table of contents
Introduction:................................................................................................................................3
Brexit:......................................................................................................................................3
Current positive overview and the debate based on the Brexit situation as well as the obstacles
faced by the UK people...............................................................................................................5
2/ possible options the UK faces:................................................................................................7
1. The overall Economy :...........................................................................................................12
2.Unemployment:..................................................................................................................12
3. Business:............................................................................................................................13
3.1 Companies:......................................................................................................................13
3.2 Companies are unwilling to invest:.................................................................................15
4. The British pound:.............................................................................................................16
4. Conclusions and Recommendations......................................................................................16
Refrences :.................................................................................................................................18

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Introduction:
Brexit:
The term Brexit indicates the increasing possibility of Britain for withdrawing the
business connection with the European Union.
It has been identified that due to the pros and cons, the idea for contributing in the
membership of the European community has been aroused. In the year 2013, the David
Cameron, who was the Prime minister promised the national referendum on European Union
membership so that the idea of setting question can be established.
In the year 2016 on 23rd June, after the UK vote, few numbers of UK people have voted
in favour of closing all the connection with the European Union. After the pro Brexit camp, near
about 51.9 % votes have been got against the 48.1% of vote for staying in European Union.

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In the year 2016 on 13th July, Theresa May has been appointed as the new leader of UK.
By guiding UK in the lengthy negotiation process, for leaving European Union, she has
performed her job.
The official process for leaving European Union has been started by the new leader by activating
the Article 50. The Article 50 is about the Treaty of Lisbon that outlines the process for stating
the right for leaving individually. In the words of Rothwell and Capurro (2019), there are total
numbers of t5 basic points have been mentioned in the Article 50, which are sufficient for
convincing people for leaving European Union. In the Article 50, the British Prime minister has
set the limit for 2 years for understanding the negation process in the Irish Border so that the
leaving and trading procedure can be completed within the expected schedule.

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After the completion of Brexit vote, in the year 2019 on 29th march, the new phrase namely
Transition phase has been introduced to the UK entrants. Depending on the mutual agreement
between the European Union and UK people, the result of negotiation has been driven.
Current positive overview and the debate based on the Brexit situation as well as the
obstacles faced by the UK people
After the completion of negotiation between the European Union and UK people, none of
the deals for highlighting the debate between the both the parties have been introduced so that
the withdrawal agreement can be properly implemented.

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In the year 2018, on November 14th , the deal has been approved by the EU leaders and
the British government ion which the separation as well as the policies and political declaration
of the withdrawal agreement has been clearly mentioned. In the same day, the declaration of the
nature and future of the ties between EU and UK has been clarified.
In the withdrawal agreement, in the page number of 585, the legal consequences as well
as the key issues of “divorce” has been highlighted. Here the financial obligations as well as the
citizen rights of the European people has been clarified, which has been discussed based on the
Trish border areas. Irish border is being considered as the land frontier between EU and UK. In
case of both the sides, the result of negotiation has Backstop the entire deal.
The Backstop deal is being considered as the insurance policy in which the Brexit treaty,
withdrawal agreement and the harder border policy in Ireland has been driven. It is true that the
retain policies are only being used in case of driving the overarching free trade deal between the
EU and UK countries. By continuing this, it can be said that in case of both the side of countries,
the different trade principles have been identified on the land frontier between Northern Ireland
and the Republic.
After the completion of Brexit vote, in the year 2019 on 29th march, the new phrase
namely Transition phase has been introduced to the UK entrants. Depending on the mutual
agreement between the European Union and UK people, the result of negotiation has been
driven.

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It cannot be denied that the deal includes the backstop, which indicates the Northern
Ireland staying aligned as well as some rules from the European Union single market. After the
end of the transaction period, the entire process has been driven the business rules of both the
countries.
As a result, the goods and services which come from the side of the Northern Ireland and
rest of the goods are sent to the UK market, are being checked for understanding if the goods are
being able to satisfy the essentiality and the standard of EU market.
In order to involve in the in the effective manner, it is very important for maintaining the
good attachment with the EU and UK customers union.
However, it cannot be denied that it is harder for UK to leave the backstop unilaterally as
EU may need to approve the backstop ending.
This is also very important for UK to follow the European Union rules for the particular
time as in case of implementing the Withdrawal agreement in the effective manner in the
parliament, the the Backstop can create challenges for UK to leaving the European nation. The
EU leaders have refused for reopening the negotiation process on the Irish backstop. It has been
mentioned in the UK Brexit deal that by continuing the Backstop, it can make difficult situation
for the UK.
2/ possible options the UK faces:
In the option range, it has been mentioned that none of the Brexit deal can be the second
referendum, which can result the UK for staying in the bloc.

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After understanding the resounding defeat of the deal of the prime minister, the prime minister
can be left from her position and an alternative for the little time can be appointed in case of
handling the Britain’s scheduled exit. Large number of the Brexiters are preferring to leave the
EU without making any kind of deal because as per the deal, the negotiation of May can keep
UK close to the bloc, which can backstop for entering the force. It has been identified that most
of the cases, the large numbers of Remainers dream for the second referendum, which can
reserve the original decision of the 2016 for leaving the bloc.

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In the below table, the five key points depending on the Brexit Spectrum has been dicusssed. It is
being considered as the simple way for understanding the ‘options as well as the properties of the
table.

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Future effect of the Brexit date
There are few month left for scheduling the Brexit, however, it is true that there are some effect
of the decision which has been shown.
1. The overall Economy :
In the British bank, the trade investments has been slowed down. It has been identified that most
of the organizations are denying to flash the cash. As its impact, the by calculating the total level
of GDP, the bank can be able to lower the loan rate 1.2% within the coming three years.
2.Unemployment:

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In the above diagram, it has been shown that the rate of unemployment has been reduced near
about 4% in between the months of March and May. From the year 1970, the labor market has
been strengthen after the EU referendum. Analysing the diagram, it has been identified that not
only the unemployment rate has been reduced, but also it has driven the growth of fulltime job
rates.
3. Business:
3.1 Companies:
It has been identified that the rate of employment plays an important role for driving the business
performance of the companies.
By developing the contingency plans, the banking authorities set the alternatives in Paris or
Dublin. Individuals try to reveal much information about their banks. However, in the banking
reports, it has been identified that thousands of jobs have been introduced by the City, which can
be shown as the effect of referendum. As per the London's Lord Mayor the total rate will
increase on 29th March.

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It has been identified that the relationship of future trading with the European Union can get
influenced depending on the potential expanses of European cities. By including the Ford and
JLR, the job cutting process after the Brexit incident can be contribute in the decision making
process. Depending on the uncertainty, the companies can focus on hiring the plans. By
developing no-deal contingency plans, overall employment can be influenced.
It is true that after the Brexit deal, the car companies are facing lower demand, oversupply and
others issues. Due to the uncertainty, the companies can improve the hiring the plans. Due to the
impact of employment rate the contingency plan can be influenced.

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3.2 Companies are unwilling to invest:
In the above diagram, the rate of business investment has been analysed. It has been identified
that business investment has shown the continuous disappointing rate in UK after the EU
referendum. It has been identified that the investment has been increased 2% at the time of
Brexit vote and it has reduced 0.2% in the previous year. By continuing this it can be said that
before the referendum, the expected business investment was 13% over the two years. However,
due to the negative growth impact and investment rate, disappointment among the entrepreneurs
have been increased.
3.3 Companies stockpiling:
Large number of companies are focusing on the stockpiling. In order to prevent the disruption in
the supply chain process, the extra machinery as well as packaging has been introduced so that
the British Foods Association can contribute in producing Ryvita and tea. The Cadbury makers
have started stocking the products.

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4. The British pound:
In the above diagram, the pond performance of for the UK holidaymakers has been introduced. It
has made the UK as the attractive destination. In the overseas record, it has been identified that
total numbers of 39.2million, visitors have been increased in UK in the year 2017 and they have
spent £24.5bn. In the last survey, it has been identified that the over the last few months, the
export orders have been driven up. However, by continuing this, it can be said that the fear of the
customers regarding no-deal scenario can delay the extra charges of delivery.
4. Conclusions and Recommendations
In the study, it can be concluded that the Brexit has brought huge impact on the business
performance of both the countries, which has brought various uncertainty in UK. Analyzing the

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situation it has been identified that not only the unemployment rate, but also the banking sector
can be the whiteness entire Brexit consequences. The territorial accessibility can also be
decreased, which can drive the trade deals as well as the business investment process. In this
study it has been identified that depending on the current situation.
Activities of EU and UK companies and those impact after the two months of leaving the
EU
As stated by Chancellor Philip Hammond, the "resilience through the turbulence of the Brexit
process has been particularly noteworthy”. However, some of the businesses needs to focus on
improving the job, output and business practices. Depending on the slower growth in the
business sector, the China and European Union can get influenced. Analysing the consequences
of the Brexit, it can be recommended that the business investment processes needs to be
different.

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Refrences :
-Rothwell, J. and Capurro, D. (2019). [online] Available at:
https://www.telegraph.co.uk/politics/0/what-is-article-50-the-only-explanation-you-need-to-read/
[Accessed 24 Feb. 2019].
Bbc.co.uk 2019. [online] Available at: https://www.bbc.co.uk/news/uk-politics-45610768
[Accessed 24 Feb. 2019].
Bbc.co.uk 2019. [online] Available at: https://www.bbc.co.uk/news/business-46862790
[Accessed 24 Feb. 2019].
Theweek.co.uk 2019. [online] Available at: https://www.theweek.co.uk/brexit/73825/eu-
referendum-how-did-your-area-vote [Accessed 24 Feb. 2019].