European business and political leaders are ratcheting up the pressure on UK Prime Minister Theresa May to deliver an orderly Brexit.
German Chancellor Angela Merkel used her 30-minute address at the World Economic Forum on Wednesday to make clear that she doesn’t want the United Kingdom to crash out of the bloc. But she did not mention any potential EU concessions that would sweeten the divorce deal the UK parliament rejected by a huge majority last week.
“We all have to live with the shock of Britain leaving the European Union,” she said. “All of my efforts go to try and see that this is happening in a well ordered manner.”
“The less complicated, the easier our relations, the better for all of us,” Merkel added.
Merkel is one of a handful of key EU leaders to make the trip into the mountains of Switzerland. French President Emanuel Macron pulled out to deal with a political crisis at home, and May called off her trip after British lawmakers voted down her Brexit plan.
Other EU officials in Davos were more direct about the risk of a disorderly Brexit, and what May must do next.
“It’s not up to us,” Pierre Moscovici, the European commissioner for economic and financial affairs, told CNN. “It’s now high time for the United Kingdom to clarify its position, to come back to its EU partners and say these are my options.”
May faces hostile forces both abroad and at home, where businesses are clamoring for clarity. Already this week, UK vacuum maker Dyson announced it was moving its headquarters to Singapore (it denies the decision was motivated by Brexit) and Sony said it would move its legal base in Europe from London to Amsterdam (it blamed uncertainty over Brexit).
Risk of profound damage
The nightmare scenario for companies in the United Kingdom is that the country crashes out of the European Union without a deal on Brexit. That would result in new trade barriers and higher costs for businesses. Manufacturing companies are especially unnerved by the damage that snarled supply chains would cause.
Carolyn Fairbarn, director general of the Confederation of British Industry, said the moves by Sony and Dyson show how “mobile businesses are.”
“I am talking quite a lot of about the risk of no deal to businesses, I’m hearing it from our businesses with enormous urgency now,” she told CNN in Davos. “Business simply cannot be prepared for [a disorderly Brexit] … the damages to our economy would be so profound.”
Some UK officials did make the trip to Davos. The UK’s International Trade Secretary Liam Fox was on the scene, discussing potential free trade deals with countries like Israel, Canada and Colombia.
But he also warned those he met to prepare for a possible no-deal Brexit.
“In order to ensure that we get continuity of trade, it’s essential that our trading partners understand that no-deal is a possibility,” Fox told BBC Radio.