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Firms in Britain highly worried about Brexit Uncertainties

US Rep. Ilhan Omar (D-MN) (L) talks with Speaker of the House Nancy Pelosi (D-CA) during a rally with fellow Democrats before voting on H.R. 1, or the People Act, on the East Steps of the US Capitol on March 08, 2019 in Washington, DC. (AFP photo)
An anti-Brexit activist waves a Union and a European Union flag as they demonstrate outside the Houses of Parliament in central London on January 23, 2019.

Economic concern over no-deal Brexit is gaining momentum in Britain as no sign of conciliation is seen on the horizon between the government and its critics particularly after the former was forced to publish a legal advice showing the country could be locked indefinitely in the EU's orbit.

A no-deal Brexit could inflict an enormous damage to output, investment and jobs as the UK is struggling to meet its Brexit deadline of March 29, a report by Associated Press said. 

The damages have already been sustained. In the latest blow to the UK economy,  the auto giant Nissan said it had dropped plans to build a new model X-trail vehicle in Britain.

The decision made on Sunday came months after Britain’s vote to leave the EU. The car manufacturers said it would now build the vehicle in Japan.

“While we have taken this decision for business reasons, the continued uncertainty around the UK’s future relationship with the EU is not helping companies like ours to plan for the future”, Gianluca de Ficchy, Nissan’s Europe chairman, said in a statement.

Brexit uncertainties have already harmed Britain’s auto industry. A report by the Society of Motor Manufacturers said “Britain’s car production has slumped to a five year low and investment has been cut in half.

"The industry is very worried and we've been very clear 'no deal' would be a disaster. We need a deal. We need that status quo transition that gives you some breathing space to allow you to negotiate whatever the future relationship is going to be," the report added.

On the other hand, in retail sector, concerns are growing over the empty shelves and higher prices if there's a no-deal Brexit.

According to a report by the lobby group, Institute of Directors (IoD) nearly one in three British businesses plan to relocate some of their operations abroad as part of efforts to cope with a hard Bexit.

“29% of firms in a survey of 1,200 members believed Brexit posed a significant risk to their operations in the UK and had either moved part of their businesses abroad already or were planning to do so,” the Guardian quoted the report as saying.

Other sectors like banking are also struggling with the same concerns. “UK banking giant Barclays has shifted nearly 200 billion US dollars of assets to its Irish subsidiary, saying it can't wait any longer for an agreement,” the Associated Press reported.  

Britain’s government has indicated that there would be no option but to leave the EU at the end of March if the Commons reject an improved version of her draft Brexit deal.

Many business leaders insist the highly-feared situation could create massive shocks in the markets and result in huge financial losses for both the UK and the EU.

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