Comprehensive Analysis: Potential Impacts of Brexit on UK Business

This report provides an overview of the potential impacts of Brexit on UK businesses. It begins with a discussion of Brexit, its complexities, and the various issues that need to be resolved, including the impact on the public sector, financing, regulation, and employment. The report then examines reviews and opinions from various sources, including Mark Carney, governor of the Bank of England, and surveys of business owners. It explores both positive and negative impacts, such as the confidence of SMEs, the stability of the UK's legal environment, and potential threats to the financial industry and real estate market. The report concludes by summarizing the key points, suggesting that Brexit may have both positive and negative impacts on business and financial positions, and that it could damage the UK's and Europe's economic development. The report references several books, journals, and online articles to support its analysis.

DISCUSS AND EVALUATE THE POTENTIAL
IMPACTS OF BREXIT ON BUSINESS

TABLE OF CONTENTS
Q.1 An overview about Brexit.....................................................................................................1
Q.2. Discussion over the reviews of Brexit from different people..............................................1
Q.3 Conclusion of the key points of Brexit.................................................................................2
REFRENCES...................................................................................................................................3

Q.1 An overview about Brexit
In June 2016, UK decided to leave the European Union in 2 years in whichwhere UK
hadds to negotiate it’s exit. Brexit is the most complex issue which the UK is facing. There are
variety of issues which needs to be resolved including the impact of Brexit on public sector,
which is being regulated by European law. After leaving Europe ,European Union, the public
sector will be affected as the free movement of goods will come to an end. It will create the
problem of recruitment of enough workers to fill vacancies (Goodwin and Heath 2016). The
potential impact will be on areas of financing, resource availability, regulation and employment.
There are lot of unknown future decisions which can affect the final outcomes of the Brexit. The
UK’s financial system is largely dependsdepended on the its future relationship with Europe. The
present report will givesgive an overview about the impact of Brexit on business of UK.
Q.2. Discussion over the reviews of Brexit from different people
The Brexit has both positive and negative impact on business. Many people hashave
suggested their opinions on the the impact of Brexit. Mark Carney, governor of the Bank of
England has warned that Britain would face big economic consequences which leads to need of
interest rates cuts if the Brexit ends without any deal as Brexit without a deal will weaken the
public finances (How Will Brexit Affect the Sale of My Business. 2018). According to the latest
news, the governor said both theboth the UK and European union should clear out the deal of
Brexit. He further added that the bank has reserved the funds to meet any consequences and the
country''scountry’s financial system is in a position to be risk-free that could happen from the
UK leaving EU without an agreement.
A survey of “SME Heroes or Zeros “of more than 500 business owners is stated
that around 50% have confidence in growth of their company than 2016. Accounting According
to this survey report, more than 50% of business owners has chooschosening different
alternatives of financing especially external finance methods. These research highlighted that
SME’s are performing strongly against the pre and post Brexit. The HSBC isHSBC is optimistic
about the about the global growth because of the Brexit. Despite of having being warned about
no-deal exit, the plan of HSBC has not changed. The HSBC group chief executive John Flint
states that there will be no such impact of Brexit on their business.
1

It is forecasted by many people that the UK economy remains stable following
Brexit. There will be chance of growing demands from the investors which are positive about
hethe new UK's trading environment. However, there could be chance of worsening the
economic condition of UK’s post-Brexit as GDP will decline or inflation will rise. In the opinion
of some people, the sectors which is relying on EU suppliers or employees will face greater
challenges around Brexit. The UK has the most stable legal, tax and regulatory environment in
the world, that it will not be affected much post Brexit (Brexit, 2018). Any buyer if wanted to
buy a business in UK will continue to buy with buoyed by the stability of the U.K. They will
boost up the financial condition back ,back and the government can cut the corporation tax if
required. This type of decisions can stimulate the confidence of the buyers for the road ahead.
According to the new article in Forbes, there is threat in UK's parliament regarding no-
deal exit, in which UK can leave EU without having any agreement on its trade relation with
other European Countries has become high. According to the article, it is clear that global
economy will be affected by Brexit (Brexit having negative impact on NI business, 2018). It can
affect the finance industry and real estate market, as well as shift in financial and economic
stability. If the British bank are not granted any benefits from EU, the Asian financial institution
can take the advantage by opening a competition. It would affect business of British banks like
HSBC and Barclays.
In 2017, Britain was the weakest Group of seven economies in terms of overall Growth.
Industry groups worrying that Britain is becoming less attractive for the workers they want
particularly in sectors such as engineering, construction and healthcare (Brexit vote impact felt
throughout UK economy.2018). This would lead skill shortage in UK. While the Bank of
England expects the business investment to grow this year, but overall global economic upswing
is still the topic for consideration. There will be weak growth of investment after Brexit in
Britain this year. After the Brexit vote, British consumers are facing higher inflation by the fall in
the pound. The Brexit has the most damaging impact on the cost of living. The import of UK's
firm raises the cost and gradually passed on to the customers in the form of high price.
The only good thing of Brexit vote is tourism sector. The fall in value of pound made the
country a more attractive destination for foreign tourists. Currency moves seem to have been a
2

big factor. Visits from EU rose 4 percent as the euro strengthened further against the pound,
where the tourists from US decreases as value of US dollar has increased.
Q.3 Conclusion of the key points of Brexit
By measuring the possible impact of Brexit on UK, Itit can be said that Brexit may have
positive or negative impact on business and financial position. From a purely economic point of
view, the Brexit will have cause more economic damage than benefits. If the UK leavesthe EU
without any agreement, the UK's business environment will suffer (Novy, 2017). Although the
HSBC is prepared for the no-deal exit, it would impact the business as there comes a need to cut
the interest rates. The government has to increase the tariffs or trade barriers to boost up the
locale trade,whichtrade, which may leads to lose all trade privileges arising from EU
membership. But on the positive side, the SMEs are confident for the growth of their business
post-Brexit. The economic condition will increase slowly as UK will not have to invest in the
budget of EU. In summary, we come to the conclusion that Brexit would damage not only UK
but whole Europe's economic development.
3

REFRENCES
Books and Journals
Becker, S. O., Fetzer, T. and Novy, D. 2017. Who voted for Brexit? A comprehensive district-
level analysis. Economic Policy. 32(92). pp.601-650.
Goodwin M.J. and Heath, O. 2016. The 2016 referendum, Brexit and the left behind: An
aggregate‐level analysis of the result. The Political Quarterly. 87(3). pp.323-332.
Online
How Will Brexit Affect the Sale of My Business. 2018. [Online] Available Through:
<https://www.entrepreneur.com/article/317100>
Brexit. 2018. [Online] Available Through: <https://www.wsj.com/articles/britain-tells-two-
brexit-stories-that-add-up-to-one-big-problem-1533767980>
Brexit having negative impact on NI business. 2018. [Online] Available
Through:<https://www.bbc.co.uk/news/uk-northern-ireland-45034012>
Brexit vote impact felt throughout UK economy.2018. [Online] Available Through
<https://www.reuters.com/article/us-britain-economy/brexit-vote-impact-felt-throughout-uk-
economy-idUSKCN1GB1BY>
4

5