BELS Brexit Perspective, March 22, 2019
As we lurch onward in this Brexit purgatory, there is no end in sight to chaos, delays and uncertainty. And our hard-earned international reputation for pragmatism and a functioning democracy is being mightily tested with our politicians seemingly paralyzed.
The UK has been successful for a long time largely because of our stability, freedoms and rule of law, all predicated on our extraordinary political traditions. To risk harming our reputation for straight dealing and fair play and our respect for procedures, customs and rules would seem to risk shaking the foundations of our society and smashing trust, which could end up being far more damaging than Brexit. While I did not vote for Brexit, this humble scribe believes that we should not be afraid to leave the EU without a deal and that this may indeed be our best negotiating position. At any rate, the latest figures belie the panic being felt by many. In times of such uncertainty, it pays to give due consideration to what we do know.
UK Economic Facts
The UK’s economy is still remarkably robust.
- Our wages are rising at their highest rate for a decade with record job creation and average earnings growth of 3.4% over the past year.
- The UK is expanding faster than Germany.
- Our public finances are improving with the projected budget deficit having fallen to £3 billion, the smallest fiscal shortfall since 2001.
- Employment is at record high levels and unemployment is at its lowest since the 1970s.
Pessimism about the UK runs contrary to some strong evidence. The economy is just fine; Brexit represents a political crisis.
Brexit Preparedness Facts
While securing a deal should be the favored course, we should beware being deafened by the cries of “crashing out” which could severely damage the UK economy.
- The UK Parliament has passed myriad Statutory Instruments to ensure there is no “cliff edge”, while the EU has published no-deal preparedness notices so that UK-EU commerce can continue.
- France has given assurances that the new “smart customs” border at Calais will keep goods flowing even under no deal.
- The Eurotunnel will stay open no matter what Brexit we have.
- The City has declared itself “no-deal ready” while the UK-EU Aviation Accord means that planes will continue to fly.
- The UK and the EU have reciprocated the ability of their citizens to visit each area for up to three months visa-free under no deal.
- Trading under WTO rules will be fine if there is no deal; the UK already does most of its deals outside the EU under these rules.
UK Life Sciences Facts
Recent analyses by Downing Ventures, UK BioIndustry Association and Informa Pharma Intelligence indicate that our life science sector is flourishing despite Brexit concerns.
- The number of R&D companies has increased by 65% since 2016.
- Annual investment totaled more than £2 billion from investors into biotech in 2018, up 85% on 2017.
- Three new companies incorporated in the sector every working day during the first two months of 2019.
- Official data from Companies House indicates 3,456 companies are involved in biotech R&D activities, a 65% increase from Q1 in 2016.
- Venture capital contributed 51% of UK biotech funding from 2016-2018, increasing by 63% from £681 million in 2016 to £1.1 billion in 2018.
- The UK is home to three of the top five global universities for pre-clinical, clinical and health sciences.
In the interest of full disclosure, while pessimism runs deep in British society, I am very much a glass-is-half-full kind of guy. As frustrated as we may be with the continued Brexit inertia, THE FACTS suggest that things are nowhere near as dark as some would have us believe. Because when you take a close look at all the UK’s incredible life science assets, its strong support for science and technology, and its well-earned status as the third global hot spot for life sciences, you will find it difficult to avoid being involved with, or touched by, British expertise. Of this you can be certain now and for years to come!
Nigel Gaymond, Executive Chair, British Expats in Life Sciences