Fifth of large UK firms have already moved operations abroad due to Brexit, new survey shows

The Institute of Directors surveyed 1,200 company directors and found that 21 per cent of large companies have already set up operations outside the UK due to Brexit

Ben Chu
Economics Editor
Friday 01 February 2019 07:32
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Airbus CEO warns the company could leave the UK in the event of no deal Brexit

A fifth of large UK firms have moved operations overseas due to Brexit, while a further 12 per cent are planning or considering it, according a new survey by the Institute of Directors (IoD).

The findings support multiple warnings that many businesses are now well past the point of no return when it comes to taking contingency action, as MPs fail to agree on how to leave the European Union and a no-deal rupture on 29 March rushes closes.

The IoD surveyed 1,200 company directors and found that 21 per cent of large firms had already set up operations outside the UK due to Brexit, while 5 per cent plan to do so and 7 per cent are actively considering it.

For medium-size firms 15 per cent have aready moved operations overseas and 8 per cent of small companies have done so.

The survey, conducted between 17 and 19 January, also found that 69 per cent of movers were shifting, or considering shifting, operations to within the European Union.

About 18 per cent of firms have now activated their contingency plans, while a similar proportion had drawn them up but had not yet pushed the button.

The sector that has done the most shifting of assets and resources overseas is finance, with 17 per cent of firms already having done so. Next comes manufacturing with 14 per cent and “professional, scientific and technical” firms next.

A tenth of information firms and 8 per cent of construction firms have also already taken action.

“It brings no pleasure to reveal these worrying signs, but we can no more ignore the real consequences of delay and confusion than business leaders can ignore the hard choices that they face in protecting their companies,” said Edwin Morgan, the interim director general of the IoD.

“The UK’s hard-won reputation as a stable, predictable environment for enterprise is being chipped away. Our political leaders must keep this in the front of their minds as we enter this critical phase of negotiations.”

The Society of Motor Manufacturers and Traders revealed this week that investment by the UK car industry halved in 2018 due to Brexit-related uncertainty.

And Barclays was given the all clear by the High Court on Wednesday to shift €190bn (£160bn) of its clients’ assets to Ireland as it ramps up preparations for Brexit.

Earlier this month, Airbus repeated a warning that it could have to close its plants if the UK crashes out of the EU with no deal.

In response to the IoD report a government spokesperson said:

“We want to protect jobs and the economy as well as provide certainty for businesses and individuals as we leave the EU. The best way to do this is to leave with a deal, and that’s what we’re focused on doing.”

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