Post-Brexit concerns amongst both Asian and non-Asian UK-based companies
Asian businesses and UK-based commentators alike fear that Brexit will severely disrupt businesses and damage key supply chains. In the meantime, The UK’s position on immigration is also driving away Asian students, residents and workers, who are also aware of the impact of overseas citizens leaving on services.
According to IZA World of Labor writer Murat Genç: “University immigration increases trade. The size of the impact depends on the type of sending countries, the type of commodities, the type of immigrants, and the size of the existing migrant population. So, it makes sense for governments to follow more liberal migration policies.” In his article The impact of migration on trade, he adds: “Promoting the pro-trade impact of immigrants in a wider public domain could make citizens more tolerant of more liberal immigration policies.”
The economic impact of Brexit on Asia doesn’t look as sombre but Taha Coburn Kutay, Chair of the UK-Asian Business Council told Asia Times that: “[t]here’s no clarity, and when people ask me at conferences about Brexit, I find I don’t know how to come up with a single argument for why it’s a good thing.”
Movement of labor is also a concern for Coburn Kutay as preferential immigration treatment will no longer be available to EU citizens and UK plans suggest a salary limit of £30,000 will be imposed on would-be immigrants eligible for visas. According to him: “With this requirement to come here, plus other things, such as fluency in English, there are going to be serious labor shortages in the UK, which will affect all manner of businesses and professions.”
On the upside, while the exact outcome of Brexit is still uncertain, some UK companies may look more attractive to Asian investors. Potential new trade deals with the UK may also involve more and different benefits for Asian companies.
Read more articles on Brexit and the labor market.