BREXIT: Case of Japanese Firms

Abstract

Europe’s long-term sluggish growth is structural. Traditional fiscal policy options are limited and the prospects for healthy level of growth are becoming more unattainable, especially in the context of Brexit and increasing fragmentation pressure on international order. The prospect of Brexit, with enormous political uncertainty, has a serious impact on UK’s economy in multiple fronts (e.g., immigration, financial regulations and flows of goods and services) and strategic practices of global firms.

Japanese companies that have invested in Britain offer an interesting example of how international business is coping with the political tumult roiling the UK economy over Brexit. Japanese firms operating in the UK and the Japanese ambassador to London have been uncharacteristically outspoken about their dissatisfaction with Brexit and its inept handling by British politicians. However, they are not rushing to exit the UK. Instead, they are making limited, defensive moves while they wait for clarity to emerge from the chaos. (Paul Maidment, Strategy and Execution).