Denis O’Brien says UK is in ‘so much chaos’ over Brexit

Irish businessman Denis O'Brien has said the UK is in so much chaos over Brexit that it looks like an emerging market rather than an established economy.

Speaking as pressure continues to mount on British prime minister Theresa May following the publication of her poorly-received draft agreement earlier in the week, Mr O'Brien described it as "probably the best of a bad deal".

Mr O’Brien told Bloomberg television that it was highly possible that the British government could fall in the coming days, with Mrs May unlikely to get sufficient backing to carry a vote on the proposed deal.

"The United Kingdom looks to me like an emerging market at the moment, there is so much chaos. She will lose a vote in the parliament, and potentially there could be a general election, and then after that we're into no-man's land."

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Mr O’Brien’s comments come as a swath of businesses said they were still preparing for a hard Brexit.

Mrs May's office on Friday released statements from a number of major companies such as Diageo, the London Stock Exchange and Royal Mail in support of her deal. However, many others said they were still planning on how to cope should the agreement fail to get enough support.

“We are going to continue with our contingency plans and that includes buffer stocks so that we have all the logistical capacity that we need to carry on running our business,” said Rolls-Royce chief executive Warren East.

Uncertain

"The political situation remains uncertain," German carmaker BMW said late on Thursday, adding that it would continue to prepare for the worst-case scenario, which is what a no-deal Brexit would represent. BMW's Mini plant in Oxford accounts for 13 per cent of Britain's total car production, with nearly 220,000 cars built there last year. Aerospace group Airbus, which employs 14,000 people in Britain, is also reportedly planning for a "no-deal" Brexit as its "baseline" scenario, according to a staff memo seen by Reuters. "For the teams working on preparing for Brexit we must stay focused and keep working at full speed from a baseline of no deal," the memo said.

The Scotch Whisky Association, which represents one-fifth of all UK food and drink exports by value, said a no-deal Brexit would cause "considerable difficulties" for the industry and increase cost and complexity.

Closer to home, Feargal O'Rourke, managing partner at PwC Ireland, said the consulting firm was continuing to advise businesses to plan on the basis of a no-deal Brexit despite there being some positives in Mrs May's draft agreement.

“While the deal has been ratified by the UK cabinet, the subsequent resignations do not bode well for formal ratification in the Houses of Parliament...the only certainty here is that it will not be a smooth process,” said Mr O’Rourke.

“From an Irish perspective, it is good news that we are past the first hurdle. We are in a much better position now with an actual deal on the table. However, businesses still do not have certainty of the final Brexit outcome or what the future trade relationship between the UK and the EU might look like. There remains too many unknowns, and it continues to be very hard for businesses to plan and make investment decisions.”

Unfortunate

British trade secretary and prominent eurosceptic Liam Fox told broadcaster CNBC there was a chance that a no-deal Brexit could still happen, although he said such a scenario would be unfortunate.

Elsewhere, the Irish Co-operative Organisation Society (Icos) and FTA Ireland, a body which represents the country’s logistics industry, both welcomed the draft agreement.

– Additional reporting: agencies