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How the world is now bracing itself for a no-deal Brexit

·Finance and policy reporter
There are fears of backlogs of lorries in Kent if no Brexit deal is reached. Photo: Gareth Fuller/PA Wire
There are fears of backlogs of lorries in Kent if no Brexit deal is reached. Photo: Gareth Fuller/PA Wire

Preparations for a no-deal Brexit look set to be stepped up across the world after a catastrophic defeat in parliament threw the British government’s plans into chaos last night.

The markets have reacted positively to signs Brexit could be delayed, but British politics is now in uncharted territory and the UK’s planned exit date of March 29 is drawing ever closer.

Here are some of the ways businesses, politicians and experts in the UK and beyond are now preparing for the worst-case scenario of Britain leaving without an agreement.


Business advisory firms are urging UK companies to take seriously the chances of a chaotic no-deal outcome in just 72 days’ time.

Steve Varley, chair of EY UK, told the Financial Times his firm would continue to advise clients to make contingency plans, despite reassurances from the chancellor Philip Hammond.

Andrew Gray, head of Brexit at PwC, said no-deal could still happen by default, warning starkly: “The time to act is now.”

READ MORE: Britain looks on the cusp of another election and a delayed Brexit

Stockpiling among British manufacturers is now at a record high, according to a survey by the Chartered Institute of Procurement & Supply. Tesco and Marks & Spencer revealed last week they had begun increasing their supplies.

But markets appear less fazed, with Bank of England governor Mark Carney putting sterling’s rise this morning down to increased confidence Brexit could be delayed and a no-deal outcome blocked by MPs.


German politicians and firms are alarmed by the prospect of a no-deal Brexit, but stress the British government is to blame and must find a solution.

The country’s economics minister Peter Altmaier has said the UK government should be given the chance to clarify its position, but ruled out renegotiation of the withdrawal agreement.

EU chief Brexit negotiator Michel Barnier has since said renegotiation is possible, but only if the UK “chooses to shift on its red lines.”

The National Association of German Cooperative Banks (BVR) also urged Theresa May’s government to provide clarity to stop severe damage to German trade with the UK, while German car industry association VDA said a no-deal Brexit would prove “fatal” and cost jobs.

READ MORE: German media try to make sense of the Brexit chaos

The Federation of German Industries (BDI) said both countries’ firms had been left “dangling in the air,” though surveys suggest German companies are not quite as spooked as their British counterparts.

60% of manufacturing firms told Germany’s Institute for Economic Research last month that a hard Brexit would hit sales, but “on a manageable scale.”


Irish ministers met yesterday to discuss no-deal planning, including urgent legislation, supply of medicines, transport links and citizens’ rights to travel between Ireland and the UK.

Prime minister Leo Varadkar said a new law would be needed to mitigate a no-deal Brexit’s effects across 21 different sectors, from railway safety and copyright law to health insurance and broadcasting.

The bill would be published in late February if necessary and voted on by the Irish parliament in March, the prime minister said.


President Macron of France. Photo: NurPhoto/SIPA USA/PA Images.
President Macron of France. Photo: NurPhoto/SIPA USA/PA Images.

The French business lobby group Medef said it still hoped a negotiated deal could be reached despite the vote, but urged French firms to accelerate back-up plans for a “fall off the cliff” scenario.

It said in a statement: “Medef calls on all companies to prepare for the worst scenario, which is to say a non-agreement.

“It encourages them to examine, in all sectors, the consequences for their business of a Brexit without agreement in terms of: logistics, legal, tax, customs, data transfer, certification.”

President Macron’s government has already passed legislation to help ensure people and goods can still cross the Channel in a no-deal scenario, as well as hiring hundreds more customs and border staff.


The Belgian prime minister Charles Michel discussed a package of emergency Brexit legislation with his cabinet this week, which could be voted on by the end of February.

Belgium’s government has warned firms a no-deal Brexit could mean tariffs of £1.96bn and put as many as 40,000 jobs at risk, according to the Guardian.


Spain’s government began advising the public and Spanish companies on how to make no-deal contingency plans this week.

A new website provides information about residency, voting rights, healthcare, education, travel, financial services and other areas, according to the Spanish newspaper El Pais.