InterConnection - why Brexit business needs to look forward

Leaving the EU is a mistake for Great Britain yet could become a mistake for European business if not handled with utmost care

In the UK, Brexit was essentially a manipulative political campaign by fringe parties and an arrogant laissez faire approach by the establishment, which has left Europe with Europeans questioning the EU’s real worth? Combine this with poor planning for refugees/immigration at an EU level along with an unconsidered reaction to the new reality of a Middle East in crisis, the plight of the lucky European becomes a very real issue for so many. The material focus of the pubic is often a result of national politics trying to redirect attention to these issues at the cost of other more local issues.

In the UK, there was a stagnant and disenfranchised north (England) ignored and made suffer in some areas whilst others in the south (England) accessed services, opportunities and wealth with much greater ease. Where there is inequity and narrowing of wealth distribution, social tension always rises. Add a dolip of dirty politics in this case from the UKIP, terrorism from a handful of delusional ISIS terrorists and manipulation at a national level et voila!!... the UK south falls asleep and the north succumbs to cruel manipulation by far right whack jobs looking to take us all back to the 17^th century, where they of course are fiefdom Kings and Queens.

It’s my opinion that great British resolve was replaced by bitterness and anger in the north at the south’s apparent affluence, whilst they suffered economic recession. Business encapsulated in the south’s bubble of affluence never imagined a Brexit win. Arrogance took over whilst the fringe elements of UKIP struck chords with the disenfranchised members of British society yet was still discounted as brinksmanship that could not sway any right thinking voter. The rest is a matter of history, which brings markets and economies all over Europe to a state of anxiety as EU member states head once again into unchartered territory.

The majority of (multinational) Corporate America and AsiaPac corporates are being build upon a cost effective centralisation model in a preferably English speaking country that is talent rich, tax friendly and pro business. This trio of likes has seen UK gain a huge share of centralised Multinational trade, which combined with the enormous Financial Services hub in London accounts for a substantial chunk of the UK’s economic machine. With Brexit, the trade side of their international business seems to now be in peril regarding Europe so why stay in Britain at all? Are they locked in? What will it cost to stay and what to leave?

They are all good questions which cannot be answered until UK triggers article 50 of the EU treaty to leave the EU. The detailed guidelines make it non legal for Britain to make trade deals with anyone until they have left the EU and are legally recognised as a “third country”. In this context, the UK is at a manifest disadvantage as are every multinational goods company that has international operations in the UK. So, as a way forward, the best thing to do is to risk assess in a logical manner the situation bearing the following in mind.

Bilateral Negotiations - Britain is looking for latitude to make bilateral negotiations in principle whilst they exit the EU. If Europe cooperates, the profile of UK trade access internationally will be significantly enhanced from the disastrous isolation it is effectively asking for under article 50 of the EU treaty. Bear in mind some of the bellied rascals like Boris Johnson who weighed in behind UKIP lies and innuendo on Brexit are now in key positions. It’s a point not lost on Brussels.

Tariffs - Britain will no longer be a member of the EU, so the risks of transborder trade, including tariffs, capital FX controls and taxes such as retention tax will be elevated as a risk consideration.

Skilled R&D - Access to European countries for trade and assets such as R&D and labour are not clear thus should be considered as an elevated risk element to be quantified when the level of concessions Europe gives the UK on exit are known.

Costs - Cost of doing business Internationally in UK will rise despite the tax concessions promised by the UK Treasury department.

Labour - Labour movements will become more restrictive for Britains and Europeans. How restrictive this is depends on the deal to be struck with the EU. This is another part of the risk assessment that should be carefully considered.

FX /Markets – They should be closely monitored for capital flights, trading shocks and of course any new regulatory rules on capital and FX controls that affect international trade vehicles like FX, company stock trading and access to debt finance. 

The misadventure in the UK has shown the potential downside even in favoured approaches in international business. That said, for every problem, there is a solution and he who does not panic gets a head start on he who does. Maybe clear vision will change the landscape when deals are finally made making haste the highest of risk elements to be avoided at all costs.

Sources/Credits:

Pics;

www.thesun.co.uk

www.mirror.co.uk

Chris Lawton at https://unsplash.com/photos/QPOaQ2Kp80c

Credits:

America’s Gun Violence, When does it stop?

Why Americans can learn from the facts of the American Civil war to divine a better future

Everybody has being shocked and outraged at the needless deaths of African Americans at supposedly routine police stops along with the deaths of the Police Officers by a deranged killer in Dallas, TX over most of last week.

I wondered at why such instant rage was tapped into so immediately when the girlfriend of the first man killed by police in Louisiana released the footage of the incident on Facebook? How can so many people be so ‘instantly’ angry underneath the calm demeanour of everyday American life? It would reason soundly that should it be the case, then the general public is segregated into two main groups, those who are affected by injustice (majority) and those who are not (privileged) making for an unbalanced and volatile nation. Yet, following that line of thought, it’s hard not to think about the injustices of 19th century autocratic Europe and how we moved on after learning very difficult lessons. Europe has many social and political problems but is a fairer place to live in today than at any time in its history! Surely, progressivism is alive and well in America with a well oiled legal system that can address such injustice? Isn’t the American dream still alive and coming true for many Americans as it has done in the past?? Afterall, isn’t America the land of opportunity for all?

I did not have to search too far before I realised America does not get instantly angry, America is always angry! The poverty gap pushes the 99% further away from the 1% who are elevated to ridiculous levels of personal wealth. Also, the 1% has a 1% who elevate again well beyond what is considered reasonable in terms of being wealthy. Wealth distribution has become very narrow in America and the inequality its breeding is getting people killed. Many in the 1% donate generously to charity which saves lives in reality, yet it does not stop the cultural disembowelment of a great nation! It would appear the status quo comes at great cost! So, this thought been a little obvious and put to one side, what of the nasty undercurrent of racism that apparently has not gone from America despite considerable efforts by many parties since the 1960s and the civil rights movement?

One might think the issue lay with the bottom feeders of the KKK weigh laying the US nation with racially fuelled violence and oppression in the 1960s as the sole source of racial tension. Over the years, such tension boils over into murders and recrimination to remind everybody why Black, White, Asian, Christian, Muslim and Jew matters more than just being ‘American!’ It’s at this juncture that I came across a very interesting article in the Washington Post by James W. Loewen addressing this issue and tracing its origins all the way back to the 1870s.

Those years were post civil war America and the vanquished pro slavery Confederacy apparently decided to fight on with the pen rather than the sword poisoning the accuracy of American History with more than misinformation. They used this misinformation to create a mirage of injustice forced upon them by the Union as denying their freedoms as States. A cruel and ridiculous lie transformed the pro slavery Confederacy into a pro state Confederacy. To keep the Confederate fires alive and the United States divided culturally from the inside, they successfully managed to:

Succession - Create the illusion that the Confederate cause for succession was based in the pursuits of freedom for individual States when they in fact succeeded due to their stubborn intent to persist with Slavery and have it vigorously enforced without any Union interference.

Trust - Create a cause that pitted those who believed in it against everybody else. If they can divide and conquer making sure others did not trust each other because of race and/or religion, then the cause of the confederacy shall remain alive and develop with the times in the cracks of ignorance that separated ego driven Americans from each other based on these kernel partitioning criteria.

Fast forward to today and apparently the fantastical glorification of the Confederacy can be found in current US School books, which paints a violent, oppressive and racist movement as folk heroes striving for what is just against the big bad old Union Government. As this is untrue and brazen to say the least, why does America want to make its people ignorant of their own immediate past? Its down to this in my view. A powerful yet dark hearted and malevolent group of Americans have a neofascist worldview that has its origins in Confederate misinformation post Civil war. They see it as their seat of power, which they will fight to maintain and grow through transformational leadership of people already intellectually and emotionally weakened by the lies, innuendo and mistrust that traces its lineage to Confederate America. Nobody wants to confront it yet everybody feels it everyday when they size a stranger up by race, gender, religion and/or net worth.

It’s my belief that when Americans face up to their past shedding misinformation for hard historical truth on the Confederacy, then and only then can they discern who they are as a people! Americans need to embrace their civil war demons as part of what it means to be American and with it, plan a better future with cool heads and wise insight gained from all lessons learned. Until then, the pattern of ebb and flow will continue as new generations of Americans are depleted of their future by a misinformed past that refuses to stay in the history books!

Sources/Credits:

Pics;

www.bcnn2.com

www.reddit.com

https://stocksnap.io/photo/B09CE159C8

Credits;

Prof. James W Loewen in a Washington Post Article

https://www.washingtonpost.com/posteverything/wp/2015/07/01/why-do-people-believe-myths-about-the-confederacy-because-our-textbooks-and-monuments-are-wrong/