Business / Economy

Brexit having a negative impact on 54% of Japanese companies in U.K., survey shows

Kyodo

About 54 percent of Japanese companies with operations in the United Kingdom have been negatively impacted by the country’s planned exit from the European Union, up 28.7 percentage points from a year ago, a recent survey showed.

A whopping 70.8 percent of Japanese manufacturers in the United Kingdom have been negatively impacted, the survey by the Japan External Trade Organization showed, as Prime Minister Boris Johnson seeks to go through with his plan to pull out of the 28-nation bloc by the end of January.

Johnson is hoping to win a majority in a Dec. 12 general election to break the deadlock that has paralyzed British politics for more than three years since the public voted to leave the EU.

In the survey conducted from Sept. 10 to Oct. 8, 57.7 percent of Japanese companies in the United Kingdom said they have compiled, are crafting or plan to draw up measures in preparation for a no-deal Brexit, up 30.9 points from the previous survey conducted last December.

The proposed measures include shifting logistics routes, with changes to customs union arrangements likely.

Across the whole of Europe, 31.0 percent of Japanese companies said they have been negatively impacted by Brexit, up 14.9 points.

Some 53.1 percent said they saw no impact, down 10.3 points, the survey showed.

The respondents said they were affected by costs related to the need to build up inventories in anticipation of confusion in logistics and customs arrangements if and when Brexit goes ahead.

Together with reduced sales, Japanese companies in the United Kingdom said they have curbed capital spending because their clients are considering relocating operations outside the country.

The survey covered 979 Japanese companies operating in Europe, of which 842, or 86 percent, responded.

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