South East: CBI warns 'no-deal' Brexit impact would be devastating

The devastating long-term economic impact of a ‘no-deal’ Brexit on the South East has been laid bare in fresh analysis of government figures by the CBI.

The study reveals how the South East could be significantly exposed to the economic fallout from leaving the EU without a deal with an estimated annual loss of output worth £28 billion by 2034.

Such a significant shortfall would hit people’s jobs, livelihoods and living standards. This figure is one-and-a-half times the annual public spending on doctors, hospitals and other health services, in the South East.

The South East’s services exports to the EU are concentrated in information and communication services (43%). At a national level, the business services sector is likely to see a negative impact in a ‘no deal’ scenario, meaning that unless a deal is struck, growth will be hampered, innovation stifled and jobs put at risk.

Additionally, the region has many businesses likely to be affected by ‘non-tariff barrier’ costs in the event of ‘no deal’, stemming from increased restrictions on the ability for people to move around Europe on business.

Phil Cousins, director of South East employer Cousins Executive Coaching, said: “As an SME in the services sector, my business depends almost entirely on a certain economic environment and confidence in the market.

“If the UK were to crash out of the EU with 'no deal', the uncertainty that this would bring, with businesses holding back on investment decisions, could severely hamper our revenue and growth for the foreseeable future.”

Malcolm Hyde, regional director for CBI South East, said: “CBI members across the region are clear: if the new approach to finding a Brexit deal continues to be a game of who blinks first, the South East economies will pay the price.

“The deadlock will only be broken by a genuine attempt by all MPs to find consensus and compromise, not stick to rusting red lines and political conditions. Like the rest of the UK, the South East is not – and cannot be – ready for no deal.

“The projected impact on our region’s economy would be devastating and while business will do all it can to reduce some of the worst aspects, a no deal scenario is unmanageable.

“The message from the CBI to our politicians is clear – we must see compromise or the whole country faces the unforgivable prospect of a disorderly Brexit which will affect jobs and livelihoods in the South East for decades to come. It’s time to put our region’s prosperity before party politics and dogma.”