Debate as to exactly what shape the UK’s Brexit deal with the EU will take will rage right up until the ink is dry on the final legal agreements – or perhaps there will be no deal at all.
Realistically, the benefits to both sides are such that the UK is almost certain to retain access to the Single Market in some shape or form, and the EU will remain a crucial trade partner.
The fact that the UK spends about £90bn more annually on goods from the EU than vice versa should create a strong vested interest in striking a sensible trade deal.
Even so, the UK must take steps to ensure it remains an attractive economy post-Brexit – for corporations and foreign investors, yes, but also for the entrepreneurs and skilled workers that will continue to drive growth.
The government has already started this charm offensive with its “Britain is open for business” rhetoric, and policy watchers at home and abroad will be keeping a keen eye out for changes to corporation tax, business rates, entrepreneurs’ tax relief, immigration criteria, and other potential enticements.
A glance east to Singapore reveals a blueprint of what the UK can expect when it finds itself outside the EU.
Today, Singapore has the world’s third highest GDP per capital and is a regional powerhouse. Between 2005 and 2008, its market was buoyed by an influx of money from mainland China and other major Asian countries, as investors looked for a safe haven for their money outside their own more volatile economies.
In the same way, investors in a number of European countries will – whatever the posturing of their political leaders – be looking at London and the UK as somewhere stable to put their money post-Brexit, while their home countries work through their own uncertainties and problems.
Switzerland has long been seen as Europe’s “somewhere safe” in purely financial terms.
But London has another kind of richness that elevates it, rooted in a diverse, world-leading cultural scene, the status of English as the lingua franca of global business, a central time zone location that facilitates business conversations with Tokyo and California in the same day, and the network effect of deep sector expertise in law, finance, and technology.
On top of that, London has a wealth of premium real estate – always considered a reliable asset, consistently in demand, and much more resilient to adverse economic conditions than other types of investment. Property will be another cornerstone of the UK’s long term positioning as the dust settles on Brexit, the reliability, resilience, and accessibility of prime London real estate in particular enhancing the country’s “safe haven” status for overseas investors.
Ultimately, everything that makes the UK (and London in particular) such a globally attractive location – language, geography, heritage, and assets – will remain unaffected by Brexit.
With the right long term strategy, a position as the “Singapore of Europe” could set the UK up to thrive alongside its continental neighbour.