With the excitement of a new Prime Minister and so many changing faces across government, it is easy to overlook that we are now less than three months away from the next Brexit cliff edge.
In other words, the risk of a no-deal Brexit is drawing dangerously close. And businesses need to prepare for that. We know that London’s strengths as a global powerhouse stand it in good stead for success and prosperity in the long term, but in the short term, the City needs certainty to thrive.
Nearly every day we are met with reminders of the wider economic harm that flirting with a no-deal Brexit and sustained uncertainty is causing, whether that is a near-stagnant services economy, a slump in the pound, or declining investment in British car manufacturing.
And as the threat of a no-deal Brexit remains live, businesses – small and large – must make sure that their contingency plans are up-to-date and thorough. While large City firms have been planning on a worst-case scenario since day one, questions remain about SMEs that perhaps do not have the resources or capacity to have such stringent plans ready.
The Bank of England’s own assessment is that the UK banking industry is resilient enough to withstand a disorderly Brexit, but there is still cause for concern. As well as potential market volatility, there remain cliff-edge issues that need to be addressed urgently, including contract continuity and movement of data.
The worst impacts of a disorderly Brexit can only be mitigated, not avoided, by preparation. In addition to industry action, there is a real need for the government to take steps to prevent cliff-edge damage.
This should be a wake-up call for Westminster. Sustained uncertainty is leaving business with its hands tied, reluctant to make everyday decisions on recruitment, expansion, and investment.
And day by day, as uncertainty persists, so does the threat of more businesses moving jobs and operations away from the UK.
The clock is ticking: politicians on all sides must now come together to agree a pragmatic solution to Brexit and make avoiding a no-deal scenario the absolute priority.
But as these debates rumble on and the UK prepares to begin a new chapter, we should not forget London’s fundamental strengths, which will mean that the City has an exciting future ahead in the long term, regardless of what comes next.
Yes, we know we will lose some business as we leave the European Union, but we also know that London has been at the centre of global trade for centuries and has built a hub that will be hard to replicate elsewhere.
After all, the City’s status as a global financial capital is enshrined by its unique combination of time zone, language, legal system, global talent, and financial ecosystem. People come here – not just for business – but also for our cultural offer, our heritage, and our open spaces.
We need a resolution to Brexit that works for households and business on both sides of the channel. But whatever path we choose to go down, we know that we will be embarking on a new chapter in this City’s long success story.
Main image credit: Getty