How #Brexit will affect British industries
Banks using London as a gateway to the EU employ about 600,000 people, makes annual profits of some 50 billion pounds. With the UK leaving the EU, it would likely lose London as the EU financial sector...
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Britain leaves the EU today (Photo by the BBC)
By 11 PM on Friday, January 30 (today), the United Kingdom will officially severe ties with the European Union.
This brings to some form of conclusion, a long and arduous task of pulling the UK out of EU. The UK will never remain the same. Whether for good or ill, it still too early to tell, but there is no gainsaying the fact that the UK will feel the impact as well its former allies in the EU.
One wouldn’t expect that after over 40 years in the EU, the UK will get out unscathed. As a matter of fact, several UK-based firms are still confused as to what will happen after Brexit or how to appropriately plan for or respond to post-Brexit events as it relates to policies and regulations.
But analysts predict that the UK economy will see adverse impacts.
First, the UK economy is 80 per cent services, and Brexit will likely affect negatively on the services industries. These include:
Banks using London as a gateway to the EU employ about 600,000 people, makes annual profits of some 50 billion pounds. With the UK leaving the EU, it would likely lose London as the EU financial sector. This means less GDP, jobs, corporate and income tax revenue, estimated at 14 billion pounds.
UK companies dominate the EU air transport market and London has the largest airport. All existing air traffic agreement is between outside countries and the EU, none with the UK
Internationals are 19 per cent of the total, generate on-and-off-campus revenue of 26 billion pounds and more than 200,000 jobs. The number is down by 20 per cent even before Brexit.
Effect on manufacturing: Automotive sector
The UK has about 169,000 employees, in the automotive sector that produce 1.7 million cars per year in the UK. The sector has a large amount of foreign investment, estimated at 8 billion pounds in the past 4-5 years.
UK factories export 78 per cent of the output, half of it to the EU, about 60 per cent of their parts are imported mainly from the EU, mainly from the EU.
Companies manufacturing in the UK after Brexit will face under WTO rule (most favoured nation)
-10 per cent tariff to sell
-tariffs on imported parts (complex supply chains)
-Rules of origin, delaying shipment and receipt
Investment has already declined sharply; output estimated to fall by 10 per cent.
*Stats support from an official webinar on the impact of Brexit on UK industries by IE Business School
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