To throw candidates, my favourite old sidewinder interview question went along the lines of “What would you do if you came home one day and there was a pig in your hall?” “Could you repeat the question” “you heard me, what would you do?” Eat it, kill it, step around it, tame it, call 911…I heard them all including stunned silence.
Brexit is OCO Global’s pig in the hall. As a business that encourages and facilitates cross border trade on behalf of our clients, any impediments, additional costs, delays or barriers to cross border trade and investment is bad for business and could be a disincentive to international trade. In the last 4 years, we have already seen several consequences.
In the case of Ireland, the UK and Europe, we are seeing clients pivot their international trade efforts to diversify their portfolio. For example, Ireland’s Export dependency on the UK has dropped from 12% in 2017 to 7% in 2020. (Source: Central Statistics Office, Goods Exports and Imports (2016-2020) & International Trade in Services (2016-2018)
While the UK is focusing on new FTAs with Japan, US, and Canada at the expense of Europe. European firms are investing a physical presence in the UK to mitigate potential new barriers, while US and Asian firms are relocating HQs and activity away from UK to Eurozone countries. Ireland, Netherlands, and France have seen a lot of the upside.
Ireland’s attractiveness as an alternative to the UK was in part responsible for a dramatic 52% increase in FDI in 2018 while France has emerged more recently with their FDI jumping 17% in 2019, overtaking the UK as the number one destination for inward investment for the first time. (Source: EY Attractiveness Survey Europe 2019 and 2020)
For OCO Global, we are headquartered in Belfast, Northern Ireland; a region that may yet see a bounce from the special status it could enjoy with a foot in Europe and the UK. Without this access, we are challenged on several fronts.
We have significant contracts with UK Government agencies like the Department for International Trade who in some cases require their suppliers to have UK presence for data protection and national security sensitivities. So, we need to maintain our London and Belfast entities. OCO Global has operated a branch structure effectively in France for more than a decade but we are now forced to covert that to a full subsidiary (Société Anonyme) to be eligible to participate in French/European tenders.
We operate a GMBH in Germany so that is it is an officially recognised EU entity and it may be attractive to move our HQ there over time, while in the Republic of Ireland we have a Limited company which we established since the Brexit vote, whereas previously, we were able to run an all island business from Belfast within the European Union. Our US government clients used to be able to engage OCO Global to represent them in Europe through any one of our offices in Belfast, Dublin, London, Paris or Frankfurt, but we are now seeing a need to novate these contracts to European Union countries where the opportunity is considered larger than the UK. Our experience of these mitigations helps us to inform our clients how to make the most of the opportunities that Brexit will bring.
So, the correct interview answer seems to be to tame the pig, get a collar on it and take it for a walk.
