Trade wars and Brexit will cause issues for Britain’s firms in 2020, but few companies are taking steps to protect themselves or capitalise on opportunities, according to a new study by TMF Group, a leading provider of international business administration services.
The company found that nearly half (46%) of British companies predict the UK’s exit from the EU will create a potentially negative impact on businesses. Roughly a third (30%) foresee the China/USA trade dispute having a negative impact on UK firms. Nearly a quarter (22%) felt the same about the prospect of a USA/EU trade war.
Despite this, very few companies have taken steps to act on these events. For example, just 1% of respondents report they have identified new target markets that are less affected by trade disputes, and just 2% report that they have identified new markets beyond the EU and the potential impact of Brexit. Less than a quarter (24%) are changing their supply chains to avoid the fallout from trade wars or changes to trading arrangements. Even fewer (22%) have created entities in new countries to help them do business more easily.
Mark Weil, TMF Group’s chief executive officer said, “The time for UK firms to watch and see is over. With the UK set to leave the EU on 31 January, changes in trade arrangements, for better or worse, are going to happen. Firms need to get ahead of the opportunities out there.
“Firms can change their supply chains and seek out new markets for their own goods. We see high growth amongst our clients in markets around the world. And while some of those markets can be complex to operate in, many are reforming and seeking to become easier to do business in.”