Siam Canadian CEO: ‘Horrible mistake’ of Brexit will hit UK market hard : June 28, 2016
Tom Seaman : Undercurrentnews
The UK’s exit from the European Union, which the country voted 52/48 in favor of on Friday, will have a lasting negative impact, predicted Jim Gulkin, founder of Bangkok, Thailand-based Siam Canadian Group.
In the medium to long term, “I believe it [Brexit] will negatively affect the overall economies of the EU and the UK, and that will translate to reduced consumer spending which will affect all sectors”, Gulkin told Undercurrent News.
“Short-term, it is going to reduce sales to UK and EU, simply due to the depreciation of their currencies. That could translate, to some degree, to marginally lower prices from some origins due to reduced sales to EU and UK. But this remains to be seen,” he said.
The referendum is not binding and any exit from the EU cannot commence until article 50 of the Lisbon treaty is triggered, which outgoing prime minister David Cameron has said is the job of his successor.
“I think Brexit is a horrible mistake. The referendum should have never happened. It was carried by the sectors of the population who are older, less educated and xenophobic. Decisions which will affect the future of many generations to come should not be left in their hands,” he told Undercurrent.
“I don’t think the UK will ever regain its strength or importance in the world. Scotland will eventually separate from the UK. Maybe, Northern Ireland, as well. Its economy will permanently diminish as a direct result of its losing many trading privileges with the EU,” he said. “The economy of the EU will also diminish. The only winner here is Russia.”
Gulkin’s business is supplying frozen seafood from Asia into Europe and the US. Companies in North America, for which the UK is a key market, agreed with his sentiment.
The prospect of Brexit has left Canadian and US exporters across several sub-sectors concerned about UK consumers’ ability to keep buying foreign seafood given the pound’s recent sharp devaluation against other currencies.
In the medium and longer terms, foreign producers will have to endure uncertainty as a newly independent UK inks new trade deals outside of the EU’s influence and the global economy deals with heightened risks of recession.
Several sources indicated to Undercurrent that they see only causes for concern, not optimism, from Brexit.
“This is a very dangerous time,” John Risley, a billionaire who is a major shareholder in Canada’s Clearwater Seafoods and Clearwater Fine Foods, told Undercurrent.
Seafood is a global business that doesn’t perform nearly as well when countries begin to close themselves off, he added.
“This whole sort of current debate that we’re having about immigration and building walls and none of the current trade deals are any good, is very dangerous,” he said.
Even though Clearwater Seafoods, which purchased UK-based Macduff Shellfish Group last year, could benefit in the short-term, Risley said that he’s against Brexit because in the long-term, companies will see opportunities compromised if countries erect barriers to markets.