The UK is not ready for Brexit. Business will pay a high price
These are the potential consequences of a disorderly Brexit, according to an analysis published Tuesday by the UK government that concludes the country is nowhere near ready to leave the European Union on March 29 without a transitional deal.
With just over a month to go, the government still lacks parliamentary support for a divorce deal that would protect trade and other EU ties for nearly two years after Brexit while a longer term arrangement is agreed.
In its analysis, the government admits it’s on track to complete only two-thirds of its “most critical” preparation projects. Many companies and individuals are even less ready for an abrupt rupture with the European Union next month.
“There is little evidence that businesses are preparing in earnest for a no deal scenario, and evidence indicates that readiness of small and medium-sized enterprises in particular is low,” the government said.
The report warns of consequences including:
Business lobby groups had been clamoring for clarity on the terms of the divorce and Britain’s future trading relationship with the European Union ever since the country voted for Brexit in June 2016.
‘Disaster for UK economy’
The British Chambers of Commerce sums up input from its members this way: A disorderly Brexit, they warn, would be “a disaster for the UK economy, for businesses and for individual livelihoods.”
Warnings from business largely match those laid out by the government.
McDonald’s (MCD) and KFC (YUM) have joined with UK supermarkets to warn that crashing out of the European Union would result in “significant” disruptions to their supply chains.
The companies said they are stockpiling goods where possible, but “all frozen and chilled storage is already being used and there is very little general warehousing space available.”
The government analysis concludes that it’s now too late for companies to fully prepare.
“Even where it can take unilateral action, the lack of preparation by businesses and individuals is likely to add to the disruption experienced in a no deal scenario,” it adds.Source: CNN
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