Businesses warm to Brexit as fears of no deal recede

Catherine Neilan
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EU Referendum - Signage And Symbols
Bring out the bunting: businesses are becoming more optimistic about the long-term impact of Brexit (Source: Getty)

British businesses are not buying the Brexit 'no deal' bluff: a new poll suggests that 45 per cent of mid-sized firms are confident the government will secure a "good" deal.

This is more than double the number who said they were not confident - around 21 per cent of respondents to YouGov's latest Brexit Monitor, which was commissioned by consultant RSM.

However, just what that means appears to differ hugely from the current official position, with 60 per cent of firms calling for the UK to retain Single Market membership in some form, something which Theresa May has ruled out.

The majority (22 per cent) of respondents also favoured a Canadian or Norwegian model for future trade, which again has been ruled out.

British businesses might not be buying into it, but May and her team will be hoping the EU27 are. The Prime Minister last night travelled to Brussels today for an early-evening dinner with Jean-Claude Juncker and Michel Barnier, ahead of the European Council summit on Thursday.

Although it is widely expected that the European Council will not agree to unlock the second stage of talks, enabling negotiators to finally discuss trade and transition, May has been making last-ditch calls to her European counterparts including German chancellor Angela Merkel, French president Emmanuel Macron and Irish Taoiseach Leo Varadkar, pleading with them to back her.

The same survey revealed a slight increase in confidence over the long-term effects of Brexit. The index - in which any reading above 100 suggests more optimism than pessimism - found that sentiment about the impact of leaving the EU has risen from 106 to 108 in the last quarter.

London firms are the most pessimistic, scoring just 95 on the index, the only region in negative territory, while central England was the most optimistic, registering a score of 122.

In sectoral terms, TMT was brimming with enthusiasm, scoring 133 on the index, while the consumer industry was at the bottom of the index, with a score of 94.

Simon Hart, RSM’s Brexit lead partner, said the survey showed a "decline in the polarisation of opinion over the impact of Brexit on the economy as we move further away from the referendum".

He added: "There are clearly many unanswered questions regarding our future trading relationships with the EU and other global markets. However, the latest results of our survey suggest that perhaps businesses are taking a more pragmatic view of what could lie ahead and are taking steps to adapt and emerge stronger post-Brexit."

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