BREXIT and Business: A Detailed Evaluation of Potential Impacts

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Added on 2024/06/28

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This report discusses and evaluates the potential impacts of BREXIT on businesses operating in the UK, highlighting both positive and negative aspects. Positive impacts include addressing overcrowding of nationals, simplifying currency use, and potential tax savings. Negative impacts involve adverse effects on business development, potential GDP decline, restricted talent pool, increased visa requirements, and rising product and administration costs. The report concludes that the government should consider global implications and foster international relationships while mitigating negative effects to ensure sustainable economic growth. Desklib provides this and many other solved assignments for students.

Discuss and Evaluate the Potential Impacts of BREXIT on Business
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Introduction
The memorable referendum for the BREXIT was effectively passed on June 23rd on 2016 when it
was voted in the favour of Great Britain to move out from European Union. With this voting, the
Pound fell to its lowest since the year 1985. Being considered as one of the best places to
conduct the business, leaving EU has changed the scenario in the business industry of UK. It has
been found that since the decision has passed many businesses have to face various issues
especially the foreign businesses. The impact that has been identified in these businesses can be
identified into two major aspects; negative and positive (Ports & Forte, 2017). The report
provided below would be presented on identifying the impact of BREXIT on businesses that are
operating in UK.
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Findings and analysis
In this segment of the report, the positive and negative impact of the BREXIT on the companies
that are operating in UK or have their business markets there would be analysed. These impacts
would be studied taking into consideration various changes and factors in the economy.
Positive Impacts
The issue of overcrowding of nationals has been faced by the economy of UK from the
beginning. Due to this, the locals are not able to get the jobs as these places have already been
filled by foreign staff. Thus with the implementation of BREXIT, this issue would be solved in
an effective manner. The bill will not only help in bringing back the talent to the economy of the
country but will also help the HR department of the companies to find the right an suitable
candidates for the job as well (Dhingra et. al., 2016). This can further help in dealing with the
issue of high rate of unemployment in the country as well.
Currently, there are two currencies that are legitimately in use in UK i.e. Pounds and Euros. Due
to this the citizens and businesses generally have to convert one currency into another. The
implementation of BREXIT will help in keeping one currency in the flow and it will help in
getting rid of the confusion created from two currencies in use. This issue not only hinders the
business transactions but also causes a delay in operations as well. With the removal of this
barrier, the development of the businesses would be ensured in a rapid manner. It will also help
UK to enjoy the benefits from the independent monetary policies.
The most significant and the positive impact that would be enjoyed by the citizens and
businesses of UK is the lowering down of taxes. Being the biggest economy of EU, currently, the
country pays an amount of 7 billion pounds in order to keep its membership in the EU. After
successful implementation of BREXIT, the country would not have to spend this sum of money
which will help in saving a large amount of tax (Busch & Matthes, 2016). This amount can be
further used in economic and infrastructural development of the company it will also help the
businesses to get hands on the developed resources as well.
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Negative impacts
Though there are some positive impacts of the BREXIT, it has been identified that the policy has
some negative impacts as well which have the potential to harm the economy of the country in a
negative manner. With the band of EU nations, the BREXIT might have an adverse impact on
the development of business opportunities and hence impact the GDP of the country. The
vendors that have their international market in UK will face the difficulties and also they will
face a decline in their revenue levels as well. This will create a negative impact of UK as a
business destination and many companies will thus shift their business out of UK (Driffield &
Karoglou, 2016).
The implementation of BREXIT will though help in development of the business opportunities
and it will create more jobs for the locals, but it will restrict the talent and this might have a
negative impact of the growth and development of businesses. There is a shortage of skilled
workforce in UK and with the ban on EU nationals; this shortage is not likely to be fulfilled.
Stats also show that the highest proportions of EU nationals are found in the economy of UK.
With the ban on the entry of this skilled workforce, the growth of various sectors in UK are
likely to stagnate and this would also reflect on the GDP of the country as well. it has been
identified that for EU nationals to work in UK, there would now be a need of a visa. The main
aim of the implementation of BREXIT in the context of employment was to kick out EU
nationals and keep the local-born talent such that inner development of the country could be
ensured effectively (Wadsworth et. al., 2016). This factor is likely to spoil the image of the
country in the international market and due to the same purpose, it would not be considered an an
ideal place to look for job or business opportunities.
Another negative impact of the implementation of BREXIT is the rise in the cost of products and
administration costs as well. The main aim of this decision was to effectively set aside the
political differences that might arise. The ideology was sought on a small level and the
economists failed to assess the global impact of BREXIT. Because of this shortcoming of the
policy, the economy and currency are taking the hardest hit (Ebell & Warren, 2016).
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Conclusion
From the report presented above, it can thus be concluded that it is important for the government
of the country to think on a global level and set aside the personal differences. This might help in
improving the relationships with other countries as well. now that the country is able to freely
enter into partnership with other countries, but it is important for UK to evaluate its other options
as well before taking any important decision which might affect the country as a whole. The
impact can be assessed in positive and negative aspects which make it essential to reduce the
negative aspects to the greatest extent possible.
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References
 Busch, B., & Matthes, J. (2016). Brexit-the economic impact: A meta-analysis (No.
10/2016). IW-Report.
 Dhingra, S., Ottaviano, G., Sampson, T., & Van Reenen, J. (2016). The impact of Brexit
on foreign investment in the UK. BREXIT 2016, 24.
 Driffield, N., & Karoglou, M. (2016). Brexit and Foreign Investment in the UK.
 Ebell, M., & Warren, J. (2016). The long-term economic impact of leaving the
EU. National Institute Economic Review, 236(1), 121-138.
 Portes, J., & Forte, G. (2017). The economic impact of Brexit-induced reductions in
migration. Oxford Review of Economic Policy, 33(suppl_1), S31-S44.
 Wadsworth, J., Dhingra, S., Ottaviano, G., & Van Reenen, J. (2016). Brexit and the
Impact of Immigration on the UK. CEP Brexit Analysis, (5), 34-53.
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