Results of the Referendum on EU Membership
We have been asked about the likely impact of leaving the EU after yesterday’s vote. The reality is that it is far too early to assess not least as the UK will continue to be a member for at least two years. Given that the extent of impact is unknown, there will continue to be huge uncertainty as witnessed by huge immediate swings in financial markets. It will take some time for this dust to settle especially as it will be prolonged by a change of political leadership and quite possibly a further General Election.
Given such a background we cannot determine potential implications which will take some time to emerge but we can note certain points:
Uncertainty is unsettling because it discourages decisions especially those related to investment, the sooner the issue is progressed the better,
Most surveys of farmers leading up to the referendum suggested strong support for leaving the EU; it can only be assumed that the result will satisfy them and hopefully provide the advantages they perceive to exist for them,
Farmers have been promised by political leaders that they will continue to be supported with national funds after CAP payments are terminated,
There are unlikely to be any significant barriers raised toward trade in agricultural engineering products as these have for many years enjoyed zero tariffs,
A consideration will be the sterling to euro exchange rate but whilst a weak pound may discomfort importers of agricultural machinery, the farming community largely benefits from a low currency.
Whilst a majority of business leaders may have supported continued membership of the EU, the job of management is to adapt to change and we are confident AEA member companies will do so.
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