Corporate Britain welcomed a Brexit breakthrough on Friday as the prospect of an imminent two-year transition deal looked set to soothe uncertainty fears.
The 16-page joint report from negotiators on both sides crucially includes “an agreement as early as possible in 2018 on transitional arrangements”, drastically lessening the chances of a “cliff-edge” Brexit in March 2019.
Top executives backed the breakthrough. Next’s Lord Wolfson said: “It looks like good news that there is going to be a transition period which makes sense for everybody. The longer business has to adjust, the less expensive the adjustment will be.
“You get days when you go to bed and think negotiations are never going to happen. I hope we don’t go into national meltdown for the next 18 months the next time [the talks] hit the buffers. People need to remember that when they are jumping up and down.”
RBS boss Ross McEwan said that “if we get a longer transition and the rules established, I think that is really good news for us”.
Young’s pubs boss Patrick Dardis said it was “great news for our industry and the UK in general” adding: “It is just a start but at least we can progress to the next stage.”
Jonathan Neame, chief executive of brewer Shepherd Neame, which has around 30 London pubs, said: “This is a welcome development, but full clarity on how the UK will trade with the EU in the future and the wider implications for business is urgently needed. We hope that Government will maintain this recent momentum in the New Year.”
Nomura analyst Andy Chaytor said Brexit turbulence in markets could subside in 2018. “If the UK and EU can quickly agree a transition deal of at least two years then we will have three years until any major changes happen because of Brexit. In other words, the key change next year is that the market’s sensitivity to Brexit negotiations should fall substantially.”
JPMorgan’s Karen Ward, a former adviser to Chancellor Philip Hammond, said: “Removing uncertainty around transition arrangements would serve as a tremendous relief to businesses on both sides of the Continent. It may also prevent financial companies in the UK enacting contingency plans at this stage.”
Rob Perrins, chief executive of housebuilder Berkeley Homes said there were still significant hurdles to overcome, particularly on skills: “The Government need to do their bit as well — not just think ‘we’ve got transition rules in place, and we’re moving onto trade so business will invest again’… There’s loads more to do. We have to hit the Brexit date but there is still this lack of certainty over what it will look like.”
Property developer Richard Tice, the Leave Means Leave co-chairman, said the UK was engaged in the “wrong negotiating strategy by the wrong negotiating team”.
He said heads of terms on a trade arrangement should be agreed with a transition, to give the EU an incentive to conclude talks.
December 8th, 2017: Evening Standard