Economy

Companies continue to live with Brexit limbo as they prepare for the worst

The Government has kept its cards close to its chest on customs checks for political reasons, but this does businesses no favours

Morris Dancers wearing T-Shirts that read “Morris against Boris” during a protest to coincide with the Conservative Party’s annual conference in Manchester. Photograph: Oli Scarff/AFP/Getty Images

Sat Oct 5 2019 - 03:29

The Brexit uncertainty for Irish business just rolls on. A no-deal Brexit crash looks unlikely, but not impossible, at the end of this month. A deal also looks unlikely within that timescale. So an extension to the Brexit deadline is the outcome most are now expected. But no one can be sure, and even if there is an extension that just leads to another deadline and most probably more last-minute manoeuvres in a few months’ time.

There is, of course, particular uncertainty for companies trading across the Irish Border. In the event of a no-deal they still do not know what checks they will face, and where and when these might be introduced. The Government has kept its cards close to its chest here for political reasons, but this leaves businesses in a near-impossible position as they try to prepare.

There are also wider fears across the business community about the impact on trade with the UK market, the possible introduction of tariffs and the near-certainty of delays and new bureaucracy.

The Government makes a lot of noise about the country being Brexit-ready. But neither the Government nor businesses are fully prepared. This is because in some cases preparations for a no-deal require large amounts of spending, which both the exchequer and companies are loath to commit given that this may not happen.

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It is also because the impact of a no-deal crash-out remains hard to predict. How long will delays be at ports? What exact tariff regime will the UK apply? What level of delays will there be on goods moving across the UK to and from Ireland and continental markets?

For now the only sensible advice to companies is to continue to prepare for the worst outcome, and to expect the uncertainty to roll on for at least a few more months.

Boris Johnson’s two-border plan won’t fly, but it remains to be seen if the EU and UK enter full-scale negotiations on the basis of what he put forward.

Businesses are crying out for some clarity. This looks unlikely to come, but given the approach now taken by the UK to Brexit, preparation for the return of customs controls and – for those selling to Britain – some regulatory barriers is essential. Even if there is an extension there is no solution in sight, which looks likely to make this work redundant.

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