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Businesses Abandon 65.5bn of Investments

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According to the CEBR (Center for Economic and Commercial Research) and Hitachi Capital, a third of all UK companies have left £ 65.5 billion investments – in a UK trade study – due to the Brexit vote.

More than a fifth (22%) of the top executives surveyed quoted the pound’s decline as one of the causes for their decision, with 21% reporting uncertainty about Britain’s future membership in the single market and 21% on economic health as an engine for postponed or abandoned investments. If these factors are not clarified, they are likely to continue to affect planned investments aimed at 2017 and later.

Of the respondents, the investment decisions of medium-sized companies were more sensitive to factors related to Brexit. 44% deferment or delay compared to only 23% for smaller enterprises, which is positive because they are less open to variations in the export and direct investment setting.

The outcomes are from a survey of 1,015 UK decision-makers appointed by top financial services corporation Hitachi Capital and led by CEBR and YouGov.

Hitachi Capital CEO, Robert Gordon, comments that: companies driving the British economy should adjust to these undefined times and take advantage of the opportunity to make new alliances around the world while interacting with the common market. 70% of companies are likely to reinvest once uncertainty about Britain’s association in the common market is fixed. However, it would be best if you remembered that admittance is different from participation, so China and the United States can interact with the EU.

He continues to say that EU exports to the UK add up to £290 billion in 2015, cementing the UK’s position as a major trading partner. If you look outward, not inward, Britain will succeed in a post-Brexit world.

The fact that almost three-quarters of companies are likely to resume investing when current urgent problems are fixed sends a message from companies to the UK government: take quick actions to avoid further losses.

For companies looking to move forward with their investment plans in the fourth quarter and beyond, corporate finance providers such as Hitachi Capital offer forms of financing that get rid of economic barriers and help companies drive economic growth.

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