BoE: Corporates are not ready for non-deal Brexit

It is likely that the UK corporate sector is in general not yet well equipped to cope with a ‘no-deal’ Brexit. This conclusion is in the Bank of England´s analysis of the Brexit situation in the UK economy (EU withdrawal scenarios & monetary & financial stability). The analysis was published  28th November 2018.

– It is unclear how comprehensive contingency planning by companies for a ‘no-deal’ Brexit is. While a growing proportion of contacts say they have prepared plans, only some of those plans have begun to be implemented. It is likely that the corporate sector is in general not yet well equipped to cope with a ‘no-deal’ Brexit, the Bank of England says.

A Confederation of British Industry (CBI) survey found that 41% of companies had carried out some of their contingency plans, but only 2% of businesses had carried out all of them.

These plans often involve stockpiling of goods imported from the EU. A CBI survey suggests that nearly 44% of businesses are planning to stockpile goods in the future, while 15% have already done so.

According to the survey, it is expected that the Brexit would mean 34 billion pounds additional import  to UK before the Brexit day, the 29th March 2019. One of the reasons for this, is the analysis of the delayed customs and transport for goods.

 

Business