Businesses have been concerned about such a prospect for months; a no-deal departure is widely seen as a “cliff-edge” scenario to be avoided at all costs for them given the uncertainty and, at least logistical, tumult it would likely cause.
Leaving without a deal in place would mean an abrupt departure from the EU with no transition period which would have allowed businesses to adjust to life outside the trading bloc – the U.K.’s largest trading partner as a bloc. It would also mean that the U.K. has to revert to World Trade Organization (WTO) rules and automatic import tariffs that could damage trade, the transporting of goods and ultimately, consumption.
The most ardent Brexiteers are fed up with the delay to Brexit, however, and believe that the U.K. should adhere to an already-extended deadline to leave the bloc. The EU has insisted many times that it is not open to renegotiating the deal it struck with former Prime Minister Theresa May last year.
On Sunday, the Confederation of British Industry (CBI) published a study warning that neither the U.K. nor EU were ready for a no-deal outcome. “While the U.K.’s preparations to date are welcome, the unprecedented nature of Brexit means some aspects cannot be mitigated,” the U.K.’s business body’s analysis, based on a study of existing plans laid out by the U.K. government, European Commission, member states and firms, showed.
“The report also highlights how – contrary to many claims – the EU lags behind the U.K. in seeking to prevent the worst effects of a no deal scenario. And although businesses have already spent billions on contingency planning for no deal, they remain hampered by unclear advice, timelines, cost and complexity,” the CBI said.
Josh Hardie, CBI’s Deputy-Director General, commented in the study that “it cannot be beyond the wit of the continent’s greatest negotiators to find a way through and agree a deal.”
“But until this becomes a reality, all must prepare to leave without one. It’s time to review outdated technical notices; launch an ambitious communications campaign for every firm in the country and rigorously test all Government plans and IT systems.”
However, he warned that the U.K. could reduce but not remove the damage of no-deal: “It’s not just about queues at ports; the invisible impact of severing services trade overnight would harm firms across the country,” he said.
UK ups no-deal Brexit planning as doubts grow over its readiness – CNBC