CBI warns on investment after Brexit letter urges 'urgent' transition deal

(c) Sky News 2017: <a href="http://news.sky.com/story/cbi-warns-on-investment-after-brexit-letter-urges-urgent-transition-deal-11095138">CBI warns on investment after Brexit letter urges 'urgent' transition deal</a>
 

The head of the CBI has told Sky News a Brexit transition deal is crucial for investment and jobs in both the UK and European Union.

Carolyn Fairbairn was speaking after our City editor revealed how the CBI was among five major business lobby groups in the UK to sign a strongly-worded letter urging the Brexit Secretary to agree a so-called honeymoon period as soon as possible.

The document demanded: "urgent agreement on transition arrangements to give businesses the certainty and time they need to prepare for a new UK-EU economic partnership".

They called for the transition period to match as closely as possible current trading arrangements with the European Union.

Ms Fairbairn said there was further evidence on Monday that firms were putting off investment - pending clarity from the Government.

She (Munich: SOQ.MU - news) pointed to the findings of the CBI's latest survey of business conditions in the manufacturing sector.

They suggested that the number of firms limiting investment plans because of a shortage of workers was at its highest level for four years while spending plans for buildings were at their lowest for eight years.

The findings were seized on by Liberal Democrat leader Sir Vince Cable who said: ""This should act as a wake-up call to the hard-line Brexiteers, who continue to dismiss warnings over the impact of a 'no deal' Brexit.

"There is nothing patriotic about ignoring the concerns of businesses and failing to act as jobs and investment move overseas."

In her interview, Ms Fairbairn denied any suggestion business lobby groups were following an anti-Brexit agenda but said they had to reflect the concerns their members had about the countdown and the potential for a cliff-edge exit.

She said: "40% of firms have changed their investment plans and reduced them as a result of Brexit uncertainty.

"These are real facts and it is a responsibility from the business community... to communicate ...what is actually happening in the economy now - with, I think, a very positive sense of what can be done, an optimism about the deal, a wish to secure a successful Brexit but to communicate this very strong sense of urgency."

A Department for Exiting the EU spokesman said: "The Prime Minister proposed a strictly time-limited implementation period in her Florence speech and was clear in her Article 50 letter that agreeing this principle early in the process would help minimise unnecessary disruption to businesses in both the UK and the EU.

"We are making real and tangible progress in a number of vital areas in negotiations. However, many of the issues that remain are linked to the discussions we need to have on our future relationship.

"That is why we are pleased that the EU has now agreed to start internal preparatory discussions on the framework for transitional arrangements as well as our future partnership."

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