The Brexit Papers — UK Government Warns Of Potential Post-exit Headaches
Welcome to a regular snapshot-review of U.S. and international economic data that aims to 1) determine the direction of economic policy — such as the speed at which central banks decide to raise interest rates, 2) provide a window into the challenges and decisions facing businesses today, and 3) assess what the impact will be for consumers.
Steady As She Goes…
The UK government this week released an initial set of documents advising British businesses and the public on what to expect if the country should leave the European Union next year without reaching an agreement with Brussels. In a speech accompanying the roll-out, Brexit Secretary Dominic Raab sought to allay concerns that exiting the EU without a deal will result in chaos of Armageddon-like proportions (there’s been some talk of deploying the army having to deliver supplies and maintain order).
The documents do hint at the level of disruption and inconvenience many will face if there is no accord in place on what the UK’s relationship with the EU will look like post-Brexit. For example, the UK government warns that businesses should “consider how they will submit customs declarations for EU trade in a ‘no deal’ scenario, including whether they should engage the services of a customs broker, freight forwarder or logistics provider to help, or alternatively secure the appropriate software and authorisations.”
They also project increased costs for credit and debit card transactions, noting: “ The cost of card payments between the UK and EU will likely increase, and these cross-border payments will no longer be covered by the surcharging ban (which prevents businesses from being able to charge consumers for using a specific payment method).”
The remaining documents covering what to expect in a ‘Hard Brexit’ world will be published before the end of next month.