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Possible Delays at Customs Post-Brexit May Bankrupt 10% of UK Companies - Survey

CC BY 2.0 / Bo&Ko / Post Brexit slump in the economy dismissed by top global banks.
Post Brexit slump in the economy dismissed by top global banks. - Sputnik International
MOSCOW (Sputnik) - New delays of just 30 minutes, which may become a consequence of the United Kingdom's withdrawal from the European Union and, possibly, the bloc's customs union, may result in 10 percent of UK businesses going bankrupt, a survey of over 1,200 supply chain managers revealed on Wednesday.

As many as 10 percent of those surveyed by the Chartered Institute of Procurement & Supply (CIPS) said their companies would likely go bankrupt if there were additional border delays of 10-30 minutes.

One to three-hour delays would surge the bankruptcy expectation rate to 14 percent, while delays between 12 and 24 hours would see it go up to 15 percent, CIPS said.

Just 4 percent of respondents fully supported UK Prime Minister Theresa May’s Chequers plan for Brexit, which envisions maintaining "a common rulebook for all goods" and harmonizing UK rules with EU to avoid problems at UK-EU border. Thirty-eight percent of those surveyed called the Chequers plan "a good attempt" to solve trade problems, while 31 percent called it "flawed and unrealistic." Nine percent of respondents said they would prefer a no-deal Brexit over the Chequers plan.

READ MORE: May Warns Against Treating UK Unfairly in Brexit Talks

Christian Democratic Union Chairwoman and German Chancellor Angela Merkel arrives for a faction meeting of her ruling Christian Union parties at the Reichstag building in Berlin, Tuesday, Sept. 25, 2018. - Sputnik International
Merkel Warns Britain Can't Have It Both Ways, Predicts Intensive Free Trade Area
Within attempts to mitigate the risk of customs delays, 24 percent of supply managers are planning to increase stockpiles, with 4 percent having already done so. As many as 21 percent said they were including Brexit-related risks in contract clauses, and the same share of respondents noted they were looking for alternative non-EU suppliers.

Almost half of the respondents said they were avoiding any preparations, since they believed that future trade deals were still unclear. Half of the firms stated that they expected difficulties with post-Brexit searches for suppliers and skills in the United Kingdom.

The survey was conducted between late August and early September among supply chain managers of 1,075 UK-based and 143 EU-based businesses.

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