Last week, it was reported by The New York Times that the UK is currently the ‘hottest investment destination’ regardless of the complexities surrounding Brexit. How could this be? Why would anyone want to invest in the UK with the chaos surrounding Brexit? In fact, not long ago, The Guardian stated that Brexit has made the UK a ‘global joke’; but let’s examine why and how the UK has become the primary destination to invest.
Surprisingly, the UK has surpassed the USA as a desired location for the first time in 10 years says consulting and accountancy firm EY, due to the decreased value of the pound since the Brexit vote. This means the UK has increased in attractiveness to foreign investors as Britain continues to maintain a stable technology sector. Such stability has been attributed to the recovery of the economy since the initial Brexit vote in 2016, and growth has been reflected by an increase of 0.2% in February 2019. This is a reassuring sign that Brexit will not necessarily trigger a recession, and SMEs should still be able to operate at full capacity. Although many business owners may perceive Brexit as being entirely negative, they must discover mechanisms to make their company work for the better. Mitigating plans to reduce risk and impact to seize the opportunities that arise will be essential for survival.
Currently, there are not any big companies who think leaving the EU with a no-deal is a good idea and would either prefer a smooth transition as the Chancellor of the Exchequer mentioned in the Spring Statement, or no Brexit to occur.
Since the referendum in June 2016, some of the major investments in Britain have been Coca-Cola’s acquisition of Costa Coffee for approximately £4 billion and Comcast’s purchase of Sky, in spite of the fact that these may be considered as safe investments due to the scale of the companies, this could be a sign of things to come, perhaps a beacon of stability.
To conclude, despite a slowdown in global growth resulting in the IMF reducing it’s predictions from 3.5% to 3.3% and the upheaval of the political climate, disruption and growth continue to prevail, making investment in the UK sexy again!
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