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Manufacturing, Logistics, Supply Chain Keynotes
Many of my previous predictions have turned out to be correct as of September 2018: for example no immediate economic meltdown, fall in currency leads to rise in exports and so on.
Here is a common sense view of what is likely to happen in the event that the EU and UK fail to achieve an agreement before the UK leaves the EU.
1. The pound will fall further against the Euro
This will make all exports of goods and services even more affordable for other nations to buy, and will make imports even more expensive. If the pound falls a further 10% post Brexit, then the total fall since the vote to leave will be 25%.
2. EU import taxes will be almost irrelevant to UK exports
Let us take an average tax of 5% on any UK goods imported into the EU from the UK, and the other way round. How much impact would that actually have when you take the new exchange rate into account?
British goods will be net 20% cheaper for French or German people to buy than before. That's huge by any measure.
French and German goods will be net 30% more expensive for British people to buy. Even more significant.
Net impact: far greater on companies exporting to the UK. In any case, the rest of the world takes more UK goods than the EU, and the EU is rapidly falling as an export destination.
Read more: 10 Truths about Brexit - cut through the media nonsense and political posturing. Why longer term impact will be less than many think. How border issues between UK and Ireland will be resolved - in event of a No Deal Brexit. ARTICLE