“Brexit”. Just the word is enough to provoke fear and derision in most who hear it – and to remind them of the many unanswered questions. What will its effects be? When will it happen? Will it actually happen at all? The official date on which Britain is currently scheduled to leave the European Union is 31st October 2019, yet parties in favour of remaining in the EU are now polling at 40.4%, while pro-Brexit formations are trailing at 34.9%. Should there be a second referendum? Might Britain end up staying in the EU after all? No-one can really tell, but one thing is certain: even if Brexit happens, it won’t be the apocalyptic disaster everyone is expecting.
Economic scenarios assume serious damage to businesses
It is widely assumed that Brexit will cause serious drops in output, with Bertelsmann Stiftung forecasting 57.3 billion Euros lost in the United Kingdom and 40.4 billion in the EU; how high losses will be for specific businesses depends, of course, to a great extent on how engaged they are in the UK market. Some stand to lose more, some much less – and many companies are already preparing for Britain’s departure, whatever form it ends up taking. Solid preparation is indeed the way to reduce potential losses, and setting up the right commercial infrastructure to deal with the UK being outside of the EU is the way forward; in many cases, Brexit has actually become an eminently plannable risk. In fact, other dangers to the global economy, such as a full-blown trade war and increasing political instability in a range of countries, are far more concerning; a slow-down in China could also develop into a serious issue for businesses, for instance.
In Frankfurt, Brexit might be good for business
Currently, the British capital is the European Union’s Number One financial centre – a status which Brexit will call into question as the City loses access to the Single Market. This raises the question as to which other European centre might succeed London, and Frankfurt is very much in the running here. Along with its large international airport, excellent quality of life, and positive image, it also brings all of the infrastructure needed for a global financial centre to the table. A hard Brexit could see the city in the German state of Hesse add to 8,000 new jobs, a development which would drive demand for office space up by as much as 200,000m². Nevertheless, the other European financial centres Dublin, Paris, and Amsterdam will also be looking to increase their standing in the wake of Brexit.