Two major studies today both point to the need for the Prime Minister and her negotiating team to seek a deal which retains membership of the European customs union and the single market.
According to a study of small business by Harvard Kennedy School, “almost all” business leaders want clear, tariff-free access to the market.
The report, which was co-authored by former Labour shadow chancellor Ed Balls and Peter Sands, ex-chief executive of Standard Chartered, said: “The businesses we spoke to were highly sceptical about the potential to replace unfettered access to the EU market with growth elsewhere.
“Companies pointed to the fact that most of the UK’s major export markets outside the EU, such as the US, Canada, Switzerland and Korea already have relatively low or no tariffs as a result of EU FTAs and other trade facilitation arrangements.”
Businesses also worried that far from having less red tape, Brexit could drive more.
“Contrary to much of the media and political commentary, the majority of businesses we interviewed were broadly satisfied with current regulatory approaches in their sectors,” it said.
“None of the companies we spoke to, across any sector, saw their industry benefiting unambiguously from Brexit.”
Businesses were united in the view that Theresa May’s oft-parroted ‘no deal is better than a bad deal’ would be a disaster for the British economy.
Since the election result, the Conservative government has been in ongoing talks with Northern Ireland’s Democratic Unionist Party to use its 10 MPs to secure a working majority in parliament. DUP leader Arlene Foster has expressed a desire to avoid a hard Brexit and wants to keep a soft border with the Republic.
Meanwhile, the Labour party, which says it is prepared to fight it out in another election, seemingly has a fluid position on Brexit. Party leader Jeremy Corbyn said on Sunday he was clear that Brexit meant an end to membership of the single market.
All this is set against the background of the EU insisting trade talks cannot begin until the issues of the divorce bill, the Irish border issue and EU citizens’ rights are settled.
In a poll of 700 of its members, Institute of Directors said that firms wanted a swift agreement with the European Union on transitional arrangements for Brexit, along with clarity on the status of EU workers in the UK.
The snap poll, which was carried out immediately after the shock election result, revealed a “dramatic drop” in confidence.
There was little appetite for another election this year, although few could identify a clear path to resolving the political uncertainty.
Stephen Martin, IoD director-general, said: “The needs of business and discussion of the economy were largely absent from the [general election] campaign, but this crash in confidence shows how urgently that must change in the new government.”