Brexit causes British companies scrap investment plans worth £65.5bn

A third of businesses have abandoned plans to spend money due to the uncertain economic situation, research says

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The Independent Online

British businesses have abandoned £65.5bn of investments because of the Brexit vote, new research shows.

A third of the 1,015 business leaders surveyed by YouGov for Hitachi Capital and the Centre for Economics and Business Research have already delayed or abolished investment.

Forty-two per cent of large businesses have ditched plans because of concerns about Brexit, while 44 per cent of medium and 32 per cent of small businesses have done the same.

The IT and telecoms sector was the most likely to have abandoned its plans, with 41 per cent having done so.

More than a fifth of senior decision makers cited the fall in the value of the pound as one of the reasons behind their decision, and 21 per cent blamed uncertainty over access to the single market.

“Based on the responses given by businesses on the value of their investment altered for reasons related to Brexit, we estimate the total value of abandoned and delayed investments since Brexit to be £65.5bn. This reflects delays and cancellations to future investment, as well as current investment,” the report said. 

Businesses also made a clear call to Theresa May’s government to end the uncertainty over what type of trade deal that would be negotiated with Europe. Seventy per cent of those surveyed said they would restart investment once single market membership is “resolved” according to Hitachi Capital chief executive, Robert Gordon. 

Gordon said: “Exports from the EU to the UK totalled £290bn in 2015, firmly cementing the UK's place as a crucial trade partner. With this in mind, businesses must not forget we are in a strong position when it comes to ensuring that the UK negotiates the best possible trade deals.

“We must pull together and continue to make investments to send this message to the rest of the world. Looking outwards, not inwards, is how the UK will thrive in a post-Brexit world.”

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