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Crunch time: How 'Brexit' could affect the MI industry

Daniel Gumble
Crunch time: How 'Brexit' could affect the MI industry

As a nation holds its breath in anticipation ahead of today’s EU referendum, MI Pro takes a final look at what an EU Exit would mean for the MI industry.

While both sides of the argument have been based largely on conjecture and guess work, it would appear that, as voting day has drawn closer, the general mood of the market has shifted from one of plucky optimism at its ability to exist outside of the single market to one of unreserved caution, as the dawning reality of a ‘Brexit’ and the associated risks move into focus.

Back in March we ran an anonymous, industry-wide poll asking simply Leave or Remain. Unsurprisingly, the result was marginal but fell on the side of an EU exit. 46.5 per cent were in the Leave camp and 43.3 per cent voted Remain. The rest were undecided.

However, last month, a number of high-ranking industry execs from MI retail, manufacturing and distribution went on the record to share their views on the subject. The overriding sentiment was that an exit would pose too many risks for what is already a fragile market that is still feeling the shockwaves of the 2008 financial crash.
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According to PMT chief, Simon Gilson, ‘Brexit’ will “result in an immediate and possibly fairly dramatic fall in the pound.” He also predicted, in an exclusive piece for MI Pro, a dramatic rise in inflation and a significant spike in interest rates, all leading towards, as he puts it, “possibly the sixth worst recession ever.”

Grim reading, indeed.

And Gilson wasn’t the only one to offer such a bleak view on the outcome on a possible departure from the Union. Several others were equally adamant that a Leave vote would be too risky for the market.

Rupert Bradbury of JG Windows told us: “I'm now convinced even more than ever that leaving the EU would be the last thing we need for our business. I want consumer confidence and growth in our economy. Leaving the EU would result in quite the opposite and that is the last thing we need, as another recession is almost guaranteed.”

Rotosound CEO, Jason How, also weighed in on the subject, stating: “One of the problems is we (the British) need European business more than the Europeans need British business. I reckon if we left there would be tariffs on exporting, which for us would not be good.”

Meanwhile, John Simpson of Stylophone distributor Dubreq outlined his view on why it’s vital for Britain to Remain. “The main impact for Dubreq even before the vote is the negative impact it is having on currency exchange rates. It’s costing us more to buy materials overseas and export sales margins are being reduced unless we increase prices. I've no doubt Brexit would only make it worse, with possibly years of uncertainty, whilst new trade agreements are negotiated.”

It’s not just here in the UK market that a departure from the EU is viewed with suspicion, but also on the continent. In a conversation with MI Pro, Stephan Kurzawski, Messe Frankfurt, gave his take on why we are stronger together. “For us as trade-fair organisers, the interests of exhibitors and visitors are paramount. They comprise the market and bring the platform we offer to life. Regardless of the referendum, we firmly believe in the future of the UK market.

“The aim of our governments must be to exploit all opportunities for maintaining the prerequisites for functional and efficient trade relations. After all, free access to the markets is essential for the development of the fair and exhibition business and international economic relations.”

What’s more, the Musicians’ Union, in one of its monthly MI Pro contributions, concluded that musicians will benefit from being part of the EU.

“Open borders make touring both easier and less expensive, EU health and safety legislation has meant that the job of being a musician has become safer and workers’ rights legislation in general has improved the working life of musicians in the UK. The Working Time Directive, for instance, redefined the definition of a worker for the purposes of working time and meant that for the first time we were able to claim holiday pay for part-time instrumental teachers.”

You can read the MU’s statement on the issue in full here.

So, with just under 12 hours left to vote (you have until 10pm) be sure to get out to your local polling booth and make sure your voice is heard.

We are currently running an anonymous Twitter poll on the issue, which, at time of writing, has Remain ahead with 62 per cent of the vote. Please be sure to cast your vote now by visiting https://twitter.com/miprofessional.

You can also leave your views in the comments box below.

Tags: eu , brexit

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