Brexit leading an
uncertain future for the UK, trade implications between the UK and EU will no
longer be free, UK will not be part of the EU single market (“Impact of
Brexit on Businesses in the UK | Market-Inspector”, 2017)
Introduction of tariffs and quotas for exports, SIG plc
currently have a large presence in Germany and France, this will increase the
cost and reduce profits.
EU leaving costs are
predicted to be up to £50 billion (passport, 2017). this suggest that UK taxes
could increase to cope
The risk of Brexit
uncertainty around access to the single market. According to Marketline SIG is
a leading distributor of specialist building products in EU. (Cross, 2017) – many EU citizens
work in construction in the UK and therefore Brexit could lead to sharp
decrease in labor supply for construction, indirectly affecting demand for
building materials (Cross, 2017).
£204 million worth of
funding for innovation and skills in the construction sector – including to
train workforce to build new homes, along with planning reforms (UK Government, 2017)
all should help stimulate growth in demand in the construction industry SIG
could capitalize on.
UK Government committed to
£44 Billion of capital funding, loans and guarantees for UK housing market over
next 5 years, with an aim to up the annual number of houses built from 217,000
last year to 300,000 by mid-2020’s (Partington
& Asthana, 2017).
strategy for 2025 sets a target for 50% reduction in greenhouse emissions in
the built environment, 33% reduction in build costs and 50% reduction in
building completion times (ENER-G, 2016)
(UK Government, 2013). This can be an
opportunity for SIG as it means there will be more demand for insulation
products in the future.
The Irish Times revealed
that 70% of Irish construction firms have cut exposure to the UK ahead of
Brexit and have begun looking for new opportunities elsewhere in mainland
Europe. (HRnews, 2017)
this means the construction
industry could be set to lose more than 175,000 EU workers if they don’t retain
access to the EU single market after Brexit.