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Deloitte warns Belgian businesses to get ready for Brexit
Financial consultancy Deloitte Belgium has confirmed what Flemish minister-president Geert Bourgeois has been saying for 18 months: Flanders’ economy will be hard-hit by a “hard Brexit”.
Flanders News reports that, according to Deloitte, Belgium will be the fourth-leading trading nation to be most affected by Brexit. Because 80% of Belgium’s export to the UK are from Flanders, Bourgeois spoke of the potential impact on the region immediately after the Brexit referendum in 2016.
“We have to be pragmatic and take the necessary steps for a ‘soft Brexit’,” he said in a press statement at the time. “The UK is a very important business partner: It’s our fourth export market. Particularly in industries where Flanders excels – like food and textiles – it’s crucial that the trade across the Channel continues.”
Deloitte’s report, “Belgium’s Brexit: Why You Should Plan Now”, says that 9% of Belgium’s total exports go to the UK. That puts the UK in fourth place for Flemish exports, behind neighbouring countries Germany, France and the Netherlands.
Trade barriers on certain goods and changes to export tariffs are the reason why trade between the UK and other EU countries could be severely affected. Should Brexit negotiators prefer a “hard Brexit”, the UK would have to resort to WTO barriers and tariffs.
“We cannot yet predict the final shape of Brexit,” wrote Deloitte Belgium CEO Piet Vandendriessche in the report. “Hoping for the most favourable scenario could be fatal to Belgian businesses. Preparing for the worst now means that businesses will be ready for all eventual outcomes.”