Thursday proved to be a momentous day for the United Kingdom as the country finally managed to agree to a deal to exit the European Union and it seems that the Brexit affair might be nearing its end. However, the deal will need to be passed by the Members of Parliament before the whole thing can be ratified. Previous deals that had been agreed by the last Prime Minister Theresa May had been voted down in Parliament repeatedly. Although such a development should lead to optimism among the business community in the country, reports suggest that they are being cautious about the whole thing.
The business leaders believe that the proposed arrangements with regards to Brexit and the deal specifically are too complex in nature. In such a situation, it is difficult to gauge how the whole situation is going to pan out after the country finally goes out of the European Union. Michael Doherty, who had been a customs officer in Ireland, stated that if Brexit leads to any difference in trade costs then it would lead to a rise in smuggling. He went on to add that the authorities would find it difficult to stop it. Doherty said,
And I can categorically say that there is no technology currently in operation, nor do I see in the near future, capable of preventing smuggling without an infrastructure.
Another expert with the think tank ESRI, Martina Lawless spoke about the fact that higher tariffs on imports could easily lead to smugglers stepping in and making it possible for people to buy products at the old prices. She said,
If you’ve got beef coming into Northern Ireland paying zero percent tariff and an 80 percent tariff regime in the Republic there will be people who want to take advantage of that gap.
The markets were cautious as well and did not rally much. It seems that investors are patiently waiting for the fate of the deal at the Parliament this weekend before making any moves.