According to an article put out by Reuters , with impending Brexit deals to be made over the next year, Germany has also reported around two dozen British-based firms opening offices in Germany, which could lead to offering at least 680 new jobs. For Britain, this could be signaling a disdain for the upcoming Brexit, while for Germany it will be a great way to capitalize on their close trade partner leaving the European Union. Most of these companies were in the Finance and Business Services industry, a little under a third being IT Services, and the other 40% being a mix of other industries.
It is important to note that these moves were likely in response to potential new tariffs and taxes to be paid through the exportation of good to Germany and the EU. In addition to this, Germany is the UK's second largest partner to whom they export goods. Do you believe that this could signal economic trouble lying ahead for the UK, or will their "business as usual" promises come to fruition?
3 comments:
I think the upcoming Brexit will affect trade between the UK and any European Country. There is a higher potential for tariffs and increased taxes on products being traded especially with machinery and automobiles. Considering the fact that the UK's largest trading partners are European countries like Germany, France, and the Netherlands, this could cause some issues regarding the companies Britain is opening up in other countries. Their business is not going to go as normal and they will have to change something in order to keep taxes low and trading relationships good with other countries in Europe.
Businesses in the IT/Service/Financial sectors leaving the UK for mainland Europe will be a big loss for Britain, particularly the London area. London has been a huge financial hub for both Europe and the global economy after New York. While the moves will hurt the huge service sectors, at the moment, I do not think that London's place as a financial hub will be easily replaced. While I do believe that their global place in the world may diminish, there are not many European cities that match the financial influence that London holds. The problem is whether or not the British parliament can all agree on a trade agreement with the EU before the end of this year or else they will leave the transition period with a hard deal. That could potentially hurt the growth of the UK even more since they would then follow the rules of the WTO.
At this point, with Brexit already completed, the United Kingdom needs to develop a good relationship with the European Union and the United States if they want to be able to succeed economically. The United Kingdom relies on trade more then most other countries and will need to reestablish their bonds with these two in order to succeed.
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