As Christmas approaches, we're swiftly coming to the end of the 12 week period, in which the Bank of England warned Government Officials, we must have a plan to stop businesses moving their offices elsewhere. With the Institute of Directors stating "uncertainty over the UK's future trading status with the EU continues to rank among companies top concerns", it's not surprising that by July this year over 11pc of businesses had begun to act. So who is it that's decided the UK is no longer for them, and would a move really be beneficial?
Finance and related Professional Services account for £190bn of the UK's incomings per year, adding up to 12% of Britain's overall economy. Fears then lie in whether London will continue to be Europe's undisputed financial hub, with Frankfurt already vying for the spot. Morgan Stanley, Standard Chartered and four of Japans big 5 banks have already announced their plans to move to the German city, with many more thought to make their choice over the coming months.
Despite this however, Guy Doetil, MD of Corporate Solutions at Colliers, suggests that for the majority of businesses, this move isn't feasible, stating, "despite any initial real estate cost savings, relocation costs would offset this and in reality, no single city in Europe has the capacity to absorb any mass migration of jobs from London at short notice. Initial estimates quoting the potential reallocation of up to 100,000 jobs seem very wide off the mark at this point."
Doetil's comments are of a widening opinion that despite the increase in businesses announcing their plans for the future, and for their move, any suggestion that the UK's economy will take a drastic hit, is simply scare-mongering. In fact, Lucia Puttrich, Europe's Minister for The State of Hesse, suggests the changes will be much subtler, writing "London will remain an important financial centre, but there will be a transfer from those who need to have an office in the EU, because London will not be in the internal market."
Probably one of the most obvious cases of unnecessary panic; initial reports regarding CitiGroup's move were met with a fear that thousands of jobs would be lost, and yet only a small group of 150 out of their 6000 strong staff force, will be relocating to Frankfurt.
Even though information regarding Brexit is still murky, and with it plans for a majority of businesses, what is clear is that more information is desperately needed, with only 19pc of businesses fully understanding the implications of the UK and EU using World Trade Organisation's rules. Until we are able to address such problems, we might continue to see a steady incline of companies choosing Bratwurst over Fish and Chips, and the Euro over the Pound.
"If we get to Christmas and the negotiations have not reached any agreement on this topic, diminishing marginal returns will kick in. Firms would start discounting the likelihood of a transition in the central case of their planning." - Sam Woods, Deputy Governor, Bank of England