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This article was first published in the September 2016 international edition of Accounting and Business magazine.

While it’s far from over, the recent vote in favour of the UK leaving the European Union is a done deal for some, and may even represent the beginnings of deglobalisation. Others, though, remain sceptical about whether there will be any change at all in the free-trade regime between the UK and Europe should parliament decide to go with the popular flow.    

The bottom line in North America is uncertainty, and it’s this uncertainty that has created all manner of speculation, particularly about the long-range impact on the value of the US dollar against international currencies. How will the authorities react (will there be a long pause on any interest rate increases)? What will be the impact on US manufacturing trade with the UK and EU if a stronger dollar drives up US export prices? Will foreign direct investment dry up from companies banking on a free-trade regime between the UK and the rest of Europe? Will the City remain the financial centre for the region? And, ultimately, can the UK hold it together in the event of another Scottish referendum? 

That’s a lot to chew on, and some US thinktanks have been giving the matter plenty of headspace. 

According to Wells Fargo, for example: ‘Brexit is a monumental decision that could potentially start an unwinding of the globalisation that has been in train for the past few decades. A period of heightened geopolitical uncertainty would not be conducive for robust growth in investment spending in many of the world’s major economies.’

While Bain says: ‘The flight to safety away from the epicentre of this British-EU divorce will push capital away from the region and toward key safe-haven markets including the US – especially treasuries – and to Japan. This will further lower market interest rates and raise relative currency values.’

And Ben Bernanke of Brookings Institute speculates: ‘In the US, the economic recovery is unlikely to be derailed by the market turmoil, so long as conditions in financial markets don’t get significantly worse. The strengthening of the dollar and the declines in US equities are relatively moderate so far. Moreover, the decline in longer-term US interest rates (including mortgage rates) partially offsets the tightening effects of the dollar and stocks on financial conditions.’

But what about CFOs trying to figure out the financial impacts on their companies? For those with significant exposure to the UK and eurozone, the new risk model requires a rethink of foreign direct investment and treasury. Some companies have reacted decisively, with Canada Life, for example, promptly suspending trading of its UK property funds, a portfolio valued at £500m. 

With shrinking pound and euro revenues, CFOs across the board will likely be sharpening their pencils on how to maintain margins in the region, which could ultimately mean job losses back home. North of the 49th parallel, Canadian exporters are perhaps more likely to feel stressed over Brexit. The big question is whether the recent Canada-EU trade deal that eliminates duties on almost all trade between the two will hold – the UK is Canada’s biggest trading partner in Europe.  

For the biggest global players, though, a wholesale change in strategy doesn’t seem on the cards. A recent CNBC survey of 48 CFOs from some of the world’s largest companies reports 70% as seeing no change in their perspective on how likely they will be to do business in the UK, and roughly 14% as only slightly less likely to change their strategy in the region.

Ramona Dzinkowski is a Canadian economist and editor-in-chief of the Sustainable Accounting Review