Does Brexit spell boom or bust for North Herts businesses? The Comet assesses the post referendum economic climate
- Credit: Archant
A month has passed since Britain’s historic vote to leave the European Union.
Following the Brexit vote on June 23, the national press was awash with stories about potential economic collapse, the pound’s drop in value and the ominous downgrading of the UK’s credit rating.
But how are businesses in North Herts coping with the new economic realities – and are we set for a decline in investment, with our multi-nationals whisking their business away to the continent?
GlaxoSmithKline announced on Monday that Galvani Bioelectronics, a new £540 million medicines firm formed jointly with Google’s parent company Alphabet, would be based in Stevenage and San Francisco.
GSK also last week announced plans to invest £275 million in three UK sites, including its base at Ware in Herts. Stevenage is not mentioned in those plans, but can surely only benefit from the commitment.
GSK chief executive Andrew Witty said: “It is testament to our skilled UK workforce and the country’s leading position in life sciences that we are making these investments in advanced manufacturing here.”
Airbus Defence and Space, which has a major base in Stevenage, has so far been less willing to allay fears that it might shift UK bases to continental Europe after Brexit.
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The firm’s bosses have indicated that nothing will change in the short term, but that ‘big decisions’ about future investment in the UK will be made in three years’ time after the outcome of Brexit becomes clearer.
The Herts Local Enterprise Partnership, a hub for economic development across the county which channels government funding, says it is ‘business as usual’ and that it is too early to assess Brexit’s impact.
LEP chairman Mark Bretton said: “Following the UK’s decision to leave the EU, there is a two-year negotiation period during which existing EU treaties, including EU funded programmes, would remain in force.
“We will continue to work constructively with businesses to understand the challenges and opportunities they face, and to ensure that our Strategic Economic Plan is responsive to those needs following this outcome.
“We will also make the case for further investment in local infrastructure, innovation, education, skills and transport and to support businesses via our growth hub.”
Other impacts are being felt more immediately. Stevenage Borough Council has said it may have to look at re-investing £55 million of reserves because the changing economic situation will affect its use of certain accounts, though North Herts District Council has said it will not be affected in this way.
A canny assessment of the situation has been made by Yolanda Rugg, who chairs the Hertfordshire Chamber of Commerce.
She told the Comet: “It’s really too early to say and to make a judgement as the EU referendum result is affecting our members in different ways.
“Certainly, for members with planned investments those plans will still go ahead but for others, with future investment plans, the decisions are less certain.
“Members involved with exporting products and services can see increased global opportunities created by the government’s continued drive for export-led growth.
“In the meantime, within the British chambers of commerce we continue to look to government for investment in infrastructure such as house building to help the economy locally and nationally.”