Brexit raises largest reduction in UK business investment in 10 years: BCC By Reuters

By William Schomberg

LONDON (Reuters) – British companies are expected to cut their investments in the next ten years in 2019 because of Brexit, even though Prime Minister Theresa May has reached an agreement to help the country out of the bloc, a group of badysts said on Monday. # 39; employers.

Business investment is expected to decline 1.0% annually in 2019, the British Chamber of Commerce (BCC) has announced.

Weak business investment is dragging down productivity, which is holding back rising wages and weighing on the economy as a whole.

"The political inaction has already had economic consequences, as many companies have hindered investment and recruitment decisions," said Adam Marshall, BCC general manager.

"Worse still, some companies have shifted their investment and growth plans as part of their emergency preparations – some of these investments may never return to the UK."

Many financial companies have moved to other EU countries and automakers have scaled back their plans for expansion in Britain. BMW said this month that it could move some of its production in case of Brexit without agreement.

In 2018, business investment fell in each of the four calendar quarters, the longest since the global financial crisis, revealed official figures.

Finance Minister Philip Hammond said he expected a recovery in business investment once the agreement reached on Brexit.

But the BCC said the misappropriation of resources to prepare for the risk of a Brexit without a transaction, high transaction costs in Britain and questions about Britain's future ties with the United States. EU would limit any quick investment. rebound.

The BCC said business investment is expected to increase by 0.6 percent in 2020 and 1.1 percent in 2021.

He lowered his overall growth forecast for the British economy to 1.2% in 2019 – in line with the Bank of England's latest forecast – compared with a previous estimate of 1.3%.

This would be the weakest growth in the economy for a decade, reflecting a slowdown in the global economy as well as Brexit.

The BCC experienced only a weak recovery, with growth increasing slightly to 1.3% and 1.4% in 2020 and 2021.

According to his forecasts, Britain would avoid a disorderly exit from the EU.

"A disorderly and disorderly exit from the EU would be a real and lasting blow to the UK's economic prospects," said Marshall.

Prime Minister Theresa May is expected to once again call on lawmakers to support her plan for Brexit this week after having twice rejected it earlier.

Also on Monday, the Rightmove real estate website announced that the asking price of homes for sale had increased by 0.4% per month over the four weeks prior to March 9, the smallest increase since that period since 2011.

Prices in London, where the real estate market showed the greatest weakness before Brexit, fell by 1.1%.

"The closer you get to the thread without the clarity of an agreed solution, the more buyers tend to wait rather than act now," said Rightmove's director Miles Shipside.