It would be interesting to hear why the British government is now recommending that small and medium size companies should move their companies to one of the EU member states. Most of us here in the EU thought that Johnson wanted the country to be bigger but now they are openly recommending it get smaller….
According to the BBC, the reason for these brilliant ideas from the boffins in Whitehall is that many smaller companies in the UK have seen that the new border controls for exporting to the EU are just too complicated for them to manage.
The process of Brexit was described by leading politicians as a “piece of cake”. Now smaller exporting companies are choking on the cake because of the paperwork and new border controls which they find and too costly to manage.
Before Brexit, it was indeed a piece of cake to sell and ship the goods to France, Germany, Finland and the other 24 member states.
One example are British fresh fish and meat products now require local testing in the buyer’s country. That is a huge extra cost for small exporters especially when each country has their own staff inspect the produce.
Now these exporters either stop exporting, or they can pay up and increase their prices at a time when producers inside the EU have no such costs to pay. The third alternative is to move the business to the EU, which means that the UK will see their own local companies close because few of them can manage to keep two production plants. That was hardly the intended consequence of Brexit, but we all know that Johnson & Co. are not the brightest boys in the class…
Finland has had its share of companies moving out of the country. The big forestry companies have not hesitated to close Finnish factories and move to Germany and other places in the EU where these governments are offering various tax and investment inducements. This has been criticised by the Finnish government because they have to cover the costs of supporting and retraining the unemployed. Many workers are also left to fend for themselves in small isolated villages located in the middle of the forests. Few people are willing to pay a decent price for their homes when there is no other work available. Some economists call this “creative destruction” but in reality it is far better to work for long-term objectives rather than moving shop for a few dimes. Singapore advertises their defence strengths by saying it takes years to create a good society, but that is also something can also be destroyed in seconds by foolish actions.
The short- and long-time consequences of things like Brexit, and the rapid relocations of companies are never as good as their promoters think… In the end the cost almost always are far higher than expected.