Hard Brexit ‘worrying’ for British companies in Catalonia
Barcelona attractive for UK businesses after leave vote, says president of British Chamber of Commerce in Spain
With one year to go until the UK is set to leave the European Union, a lot of ambiguities remain as the negotiations to reach a deal continue. As it stands, the British government seems to be erring more towards a “hard Brexit,” according to Christopher Dottie, president of the British Chamber of Commerce in Spain, founded in Barcelona over 100 years ago. This scenario could be a problem for UK companies in Catalonia, the businessman said.
Thus far, however, Dottie told Catalan News that Brexit has had no significant impact on the Catalan economy or British businesses operating in the country, yet all is not a bed of roses.
What are the effects of Brexit so far?
Although Dottie stated that there “haven’t been any strong effects so far,” some complications have arisen, specifically caused by the effect of the Brexit vote on exchange rates.
“Companies are now adapting to more volatile levels of currency. It is more difficult for Catalan companies to export to the UK,” he said, highlighting how Catalan products are now more expensive for the British consumer.
According to Dottie, the future is a cause for concern for British businesses, but this could be positive for the Catalan economy. “Some companies from the UK that know they will be outside of the EU in the future are looking to establish a second base in the EU,” Dottie explained. “Catalonia, and Barcelona in particular, is a very strong candidate for that investment.”
Why is Barcelona a good candidate as a second base for British companies?
“When companies are looking to establish a second base outside of the UK in the EU, there are some very strong candidates, there are some very strong cities within Europe, but Barcelona is definitely one of them,” Dottie explained. “The talent here is a very important factor, both Catalan talent and the fact that it’s a city of the world and it attracts talent from other countries.”
Other attractive factors for businesses looking to invest in the Catalan capital include quality of living, infrastructure, education, and labour legislation, according to Dottie. He pointed out how the city was chosen to set up the British Chamber of Commerce in Spain in 1908.
The difference between a hard and soft Brexit
“If you ask the British companies who are invested in Catalonia, there’s a big difference between a hard Brexit and a soft Brexit,” Dottie said.
“A soft Brexit wouldn’t worry companies too much. But it looks like the UK government is focussed on a hard Brexit, leaving those trading blocs, and that would be very worrying,” he said. “It would mean that Just-in-Time processes particularly for products wouldn’t work anymore. There are a lot of fruit and vegetable producers in Catalonia who sell into British supermarkets, and if suddenly their products have to wait an extra day, an extra two days, at the ports to enter the UK, that changes the whole business model.”
How is political situation affecting British businesses in Catalonia?
“British companies are obviously aware of the political situation, but they’re also aware that companies shouldn’t dictate to society or to politics how society should be managed,” Dottie said. “They would be grateful as soon as there is more clarity and certainty in the future. Any crisis points, such as we saw in October, could lead to people being worried about dual taxation or a freeze on capital, and in those situations we might see changes. But, as things are in March 2018, there is stability, there’s no reason for companies to worry, and we haven’t seen any drop in investment at all.”