The extension of the Brexit deadline is - finally - some good news for European retailers, branch organisation EuroCommerce says. However, it also has a major drawback.
Last week, a dozen organisations in retail, industry and services launched an urgent appeal to politicians on both sides of the Channel to do everything in their power to stop a no-deal Brexit. Their call seems to have helped to avert a "no-win outcome" on 29 March, now the EU has granted the UK a delay until at least 12 April. Depending on whether the British parliament accepts the withdrawal agreement (at the third attempt), that day will either see another month of extension or - still - a no-deal Brexit. In the very short term however, the latter will not happen.
The business organisations, including representatives in textile, automotive, chemicals and metals, argued that "EU and UK companies have benefited from over 40 years of economic integration and 25 years of the Single Market. As a result, value chains have become so closely intertwined that a no-deal brexit will lead to chaos", citing delays and disrupted supplies, higher costs and cash flow problems and job losses due to the uncertainty Brexit causes.
Pleased, and worried, for retailers
The organisation of European retailers is, logically, pleased that its worst case scenario has been avoided: "Europe’s retailers rely on highly integrated supply chains to make sure that our customers can find the right products on the shelves when they need them. The European Council’s agreement to an extension beyond 29 March for the UK Parliament to agree the terms of UK withdrawal and put in place the necessary legislation is welcome."
However, a spokesperson remains very cautions because "uncertainty remains", with a no-deal Brexit still not off the cards. Retailers still can not prepare for the future as almost any road forward is still possible, having "negative effects on the supply chain, not just in the UK but also in the EU27".