Following the unprecedented events in parliament over the past two days, this is perhaps the most serendipitous event of all time (though Marketing Society should chalk it up as great planning on their part!).
It’s 8am, a full house and Mark Berrisford-Smith, head of economics, at HSBC is kicking off proceedings, guiding us through the current state of political affairs and their impacts on our future economy. It’s insightful, compelling and, in places, a little bit depressing.
Mark himself has no doubt had to re-write his thoughts several times over the past few weeks and admitted that, a week ago, he wouldn’t have thought the bill to prevent a no deal Brexit would have passed, crediting the prorogation of parliament as a turning point – a step too far from Boris for even his own party.
Mark stated that we’re now in a position whereby the centre ground has gone. Ultimately, he believes the general election will be reduced to a decision over a no deal Brexit or a new referendum. The idea of Brexit with a deal is fast dissipating.
He expects a no deal Brexit to lead to a recession, albeit a shallow one, due to the devaluation of Sterling, increased inflation and further reduction in consumer confidence and spending. However, a referendum, unless decisive will itself lead to further uncertainty and continuation of the status quo.
An orderly Brexit, while off the table, would offer a little more confidence avoiding a recession but growth would remain sluggish.
Despite these potentially gloomy scenarios, Mark thought that the UK economy had been resilient and had fared better than many had hoped for. The fact that we are neither a trade hub of major exporter has protected us from the US/China trade war – part of Trump’s ‘slowbalisation’/deglobalisation policy. The same cannot be said for Japan, Germany, Singapore and Hong Kong et al.
In all, Mark dedicated over an hour sharing his thoughts and answering the numerous questions from a highly engaged audience. His intelligence, clarity and knack for making the complex simple led many after the event to question why so many others have done such a good job of obfuscating the issue.
- Mass uncertainty and the slowing of the economy
- Focus on Brexit has stopped the government dealing with the most important issues
- A recession, should we leave without a deal, albeit a shallow one
- Reduced marketing budgets until the economy shows solid growth
- Increased likelihood of the Union not surviving
- UK to be worse off in 20-30 years’ time than had we not left the EU
By Paul Vallois, MD of Nimbletank