The Brexit process faces yet more turmoil as Parliament prepares to vote for or against Theresa May’s Conservative government.
With a matter of weeks to go until the United Kingdom is set to depart the European Union, it is still unclear what exactly that means, or how it will impact business and consumers across the continent.
With Brexit expected to cause disruption to trade and further reduce its lacking talent pool that the UK technology sector currently has access to, Verdict asked four tech industry experts: May or Corbyn?
If it wasn’t already clear that May’s Brexit Withdrawal Agreement is not the plan that Parliament wants, then it is now. With her plan rejected by 432 votes to 202, whether May can continue to push for a better deal is once again under question.
However, according to Mike Cohen, CEO of progressive technology provider Evaris, a change in government won’t deliver a Brexit deal that is beneficial to the technology sector.
“Politically speaking, I have no confidence that a change of government will make any positive difference and lead to further unsettlement within business as a whole as the political opposition does not appear to have anything different to offer – only that they will attempt to renegotiate with the EU which we know, based on recent experiences, are not interested.”
With Brexit already proving to be a chaotic affair, Cohen believes that now – with just weeks to go until the deadline date – is the time for stability ahead of what is likely to be a disruptive period regardless of the outcome.
“Stability for business and consumers is what’s needed right now, and, on that basis, ‘its better the devil you know’, which I believe will benefit the IT sector as a whole,” Cohen said.
A fresh approach
The challenges that Brexit poses is a result of the uncertainty that surrounds it. As it has never been attempted before, it is difficult to know how things will change and how to deal with these changes ahead of time. Switching parties could potentially offer further confusion and problems to businesses due to key differences in each party’s manifesto.
“Based on the parties’ last manifestos for the last general election in 2017, the Labour Party’s taxation policies are potentially less beneficial to all companies as they pledged to increase corporation tax from 19 to 26 per cent whereas the Conservatives pledged to cut corporation tax. It is possible Labour’s plans to raise taxes for top earners could also have a detrimental effect on tech entrepreneurs willingness to invest in the UK,” said Toni Vitale, Head of Regulation Data & Information at Winckworth Sherwood.
“Balanced against that is the Labour Party’s plans to borrow to invest £250bn over 10 years in energy, transport and digital infrastructure and Improve 4G mobile coverage and invest to bring uninterrupted 5G to all urban areas which will undoubtedly be a boost for the tech industry if delivered.
“Tech companies have in the past relied heavily on attracting talent from overseas and the Labour Party has adopted a limit free immigration stance and this may make it easier for the flow of overseas staff to continue.”
While each manifesto has its pros and its cons, Vitale believes that a leadership change could be just what is needed to rejuvenate Brexit negotiations and get the best deal possible. Vitale likens this to football teams which often experience improved form after replacing the manager.
“In much the same way that appointing a new football manager usually inspires a spike in performance as players try to impress their new boss, a change of government of either colour may be just what the country and the tech industry needs.”
However, Vitale notes that it “does not necessarily mean a move from Tory to Labour”, with replacing May as the leader of the Conservative party likely to have a similar effect.
Business as usual
Like much of the Brexit process, tonight’s vote brings yet more uncertainty. While the recent Conservative leadership challenge seems to suggest that May still has her party’s confident, despite the rejection of her deal, there is still some possibility that Remainer rebels could vote against her tonight in an attempt to halt Brexit.
Yet, according to Cas Paton, founder of ecommerce marketplace OnBuy, “businesses shouldn’t be scared of what’s coming”.
“It’s currently a level playing field and whatever the outcome is, we can deal with it,” Paton said. “Of course it’s likely that there will be changes for international sellers, new regulations and delivery and duty changes introduced, but when the time comes, OnBuy will react and find its best way whatever the future brings.”
Alex Saric, Smart Procurement Expert at Ivalua, shares this view – but only if businesses are adequately prepared to deal with all possible Brexit outcomes.
“With time running out to make preparations, organisations need ensure they have taken steps to adapt regardless of the outcome,” Saric said.
“Organisations should be assessing their suppliers and looking for potential areas where slowdowns might occur, putting measures in place to respond to immediate disruptions such as supply shortage, friction at the border or even supplier failure.
“Without these preparations in place, organisations risk being on the back foot.
“How the situation will turn out is currently anyone’s guess. By taking a smart approach to supplier management, organisations can make decisions based on supply chain data, using insights to evaluate risk and make sourcing decisions in a world where the landscape will literally change overnight.”
Verdict deals analysis methodology
This analysis considers only announced and completed artificial intelligence deals from the GlobalData financial deals database and excludes all terminated and rumoured deals. Country and industry are defined according to the headquarters and dominant industry of the target firm. The term ‘acquisition’ refers to both completed deals and those in the bidding stage.
GlobalData tracks real-time data concerning all merger and acquisition, private equity/venture capital and asset transaction activity around the world from thousands of company websites and other reliable sources.
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