It has been a rough couple of weeks for the UK as debate over Brexit continues to ramp up. After a disastrous speech shook her party’s confidence in her ability to lead, Prime Minister Theresa May sought to allay fears that her Brexit exit strategy was in shambles. Reuters (via Business Insider) reports:
“From her point of view, the transitional agreement is non-negotiable… business should think of the two-year period as assured. It will happen,” [a] source said when asked what May had said during discussions on Monday.
The transitional agreement references a proposal on May’s part to maintain market access between the UK and Europe to prevent financial catastrophe. However, as The Guardian writes that two high ranking members in May’s government may be causing problems:
Liam Fox declared in his conference speech that the UK would be leaving the single market and the customs union in March 2019. Boris Johnson has indicated that new EU regulations and legal judgments should not apply in Britain after that landmark date.
The fear is that with so much disunity in the party, no one, not even Theresa May, knows what will happen when March 2019 rolls around. The Prime Minister may think that her decision is final but her poor credibility these days leave her plans open to debate.
Uncertainty has been a major difficulty for the British economy to overcome, as companies scramble to piece together what the post-Brexit climate will look like. Reuters’ article says that “almost all business leaders expressed concern about access to talent after Brexit,” which goes to show that even with this announcement, businesses are still struggling with the realities of a severance with the EU.
Investors should continue to follow what is happening in the UK as it continues to try and stabilise its weakening position. Any news that could jeopardise the Prime Minister’s comments could have a dramatic effect on the markets.
To read Reuters‘ article on the Prime Minister’s transition deal, click here.
To read The Guardian’s piece in the fracturing Conservative party, click here.
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