If investors hoped for one thing after Britain’s shock vote to leave the European Union, it was clarity. But there is little.
Britain has so far been clear about what will not happen: Prime Minister Theresa May has repeated that the formal divorce notification will not be sent before the end of the year and that Britain will not get a bad deal.
“We will be getting the right deal for the United Kingdom and that is the right deal in terms of trade in goods,” May told the chiefs of Wall Street and major US companies such as Citigroup and Amazon in New York the other day.
During her trip, May said the EU divorce filing would take a few months of preparation, was clear that Brexit would happen and sought to reassure the world that Britain was not turning away from the world.
Investors ranging from London-based banks and Wall Street to Japanese carmakers and small British businesses have repeatedly asked for reassurances from the British government over what Brexit will mean for them and when.
May has made clear she will not give a running commentary on Brexit or lay out all her negotiating cards in public, though some aides have suggested her plan is to invoke Article 50 early in 2017.
Boris Johnson, the most prominent leader of the Brexit campaign and now May’s foreign minister, said Britain would trigger divorce by invoking Article 50 of the European Union’s Lisbon Treaty in a letter early next year.
Article 50, a 256-word provision drafted by a former British ambassador to the EU, has never been used so there is no legal precedent for how it works though it gives a two-year period to work out the divorce.
Johnson gave few details about how to pull off one of the complicated negotiations in recent European history in such a short time.
Some officials and lawyers say the negotiation could take much longer than the two-year window set out in Article 50.
There are signs of concern: When May met Shinzo Abe in New York, the Japanese Prime Minister raised the impact of Brexit on his country’s companies, asking for “due consideration to enable their businesses to continue”.
That followed a 15-page paper by the Japanese government which raised concerns about Brexit with both the British government and the EU.
“What Japanese businesses in Europe most wish to avoid is the situation in which they are unable to discern clearly the way the Brexit negotiations are going, only grasping the whole picture at the last minute,” Japan said.
“Uncertainty is a major concern for an economy; it evokes a sense of anxiety, causing volatility in markets, and results in the contraction of trade, investment and credit,” the world’s third largest economy said.