Business leaders expect good deal with EU

On 19 June, UK Brexit negotiator David Davis stood in a room packed with journalists and TV crews and promised that a solid foundation had been set for Brexit talks.

He said he’d been ‘encouraged by the constructive approach’ on the first day of formal negotiations. ‘It was clear from the opening that both of us want to achieve the best possible outcome and the strongest possible partnership,’ he said. ‘One that works for the UK and the EU.’

Has the negotiating team delivered? And how has the middle market reacted to fledgling details about how Brexit will work in practice. 

Since June, British and European officials have met for four days each month to untangle the knotty issue of how the UK will exit the EU. Early talks have focused on the rights of EU citizens in the UK, and vice versa, and the future of the land border between Northern Ireland and the Republic of Ireland. 

Eight weeks later, and we still have little clarity on major elements of the settlement. Yet middle market leaders appear reassured by the details that have dripped from discussions so far. Our latest survey shows 45 per cent of decision makers are confident that the UK delegation will achieve a good deal with the EU. 

All regions and industries are more optimistic of a ‘good deal’ than not. Confidence levels are highest in the South (56 per cent) and North West (53 per cent), and among construction (60 per cent) and consumer (47 per cent) organisations.

RSM Brexit partner Simon Hart says: ‘The UK is in the middle of the most complex and far-reaching negotiations affecting the country since 1945. The stakes are high. But business leaders are optimistic about the UK negotiating team’s ability. They have risen above the media circus and are giving the delegation their tacit support and confidence.’ 

The teams now have around 530 days to finalise their plans and reach a deal. 

The elephant in the room is how the UK’s trading relationship with the EU will be affected. At the top of the middle market’s wish list is continued access to the single market. Our survey shows this is a priority for 60 per cent of respondents – whether it’s assured through new trade deals (33 per cent) or through a continuation of existing membership status (27 per cent). 

The issue has the potential to become a major sticking point. And with David Davis making clear that ‘nothing will be agreed until everything has been agreed’, it could be sometime before any clear details emerge. For now, however, businesses appear reassured, and are quietly getting on with the job in hand.