Understanding Brexit

‘Hard’ or ‘soft’ Brexit: balancing autonomy and access

We still don’t know what kind of relationship the UK wants with Europe, though we understand that there is trade-off between autonomy and access to EU markets.

This has led to the talk of a ‘hard’ or ‘soft’ Brexit. Though somewhat misleading, these terms are used to distinguish between a much more detached relationship (‘hard Brexit’) and one that is closer to our current membership (‘soft Brexit’).

There are a number of ‘Brexit’ outcomes (see Figure 1), which represent a departure from the European Union. Each of these present different challenges and opportunities.

The question is, what does 'hard' or 'soft' Brexit look like and where do existing models of economic co-operation between the EU and non-member states fit?

Visualising ‘hard’ vs ‘soft’ Brexit

  ‘Hard Brexit’ ‘Soft Brexit’
  • Limited access to European Single Market
  • No access to the EU’s network of Free Trade Agreements (FTAs)
  • Negotiate UK specific WTO terms and conditions before negotiating FTAs and possibly finalising EU trade relationship
  • Freedom to negotiate independent trade deals
  • Membership of the European Single Market
  • Free movement of goods and services 
  • Membership of Customs Union
  • Access to EU’s network of Free Trade Agreements with third countries.
  • Full control over immigration policy
  • Opportunity to redesign employment law
  • Visa requirements may apply for travel to EU countries
  • Continued free movement of people 
  • No barriers to hiring EU workers
  • No contribution to EU budget 
  • No participation in EU funding programs
  • Contribute to EU budget 
  • Participate in EU funding programmes

At this point, the situation is much more complicated than simply ‘hard’ or ‘soft’ Brexit. There appears to be an equal split in parliament between those who favour each option. Watch our video about beginning our departure from the EU and three things businesses can do to prepare now for Brexit.  

Read our guidance on Brexit and explore how we can help

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Exploring potential changes to trade and supply chains

Talent: shaping your future workforce

Retaining and recruiting the skills you need through Brexit

Finance and operations: adapting processes and systems

Exploring the key issues around finance and business infrastructure