International currency transfers can be easy and stress-free if your business has a plan and partners with a currency specialist right from the beginning. Whether you are a small business owner or a large business, if international currency transfers are an essential part of your operations, then a currency specialist will prove to be a valuable asset. From securing competitive exchange rates and providing risk management, a currency transfer firm such as Universal Partners FX will provide much-needed support and guidance.

Get more for your hard-earned money

One of the easiest ways to give your business a boost is by taking advantage of competitive exchange rates and securing the best possible return for your international currency transfers. If you plan ahead and lock a desired exchange rate for a future transfer or benefit from a current exchange rate, you will be able to save money and invest your funds in other assets or in developing your business further. This is the case when you send large amounts of money regularly overseas.

UPFX can help you access the best possible exchange rates available with no hidden fees or extra costs.

Know the markets

The markets are constantly changing and for this reason you want a stable and reliable currency transfer company to act efficiently and provide the best exchange rates, as these can change drastically from one moment to the next and from one day to another. One of the valuable and beneficial services UPFX provides, is its news articles on currency movements and how economic data may affect the pound or other major currencies. These regular updates are useful as they can provide a good picture of how the markets are and what could potentially influence them.

Online platform

With UPFX’s online platform, you can trade from anywhere and at any time, through your computer or mobile device. Currency transfers have never been this easy. In a fast world, where convenience is paramount, we have tried to cater to all our customers and provide services that make a difference and save you time and money. If you are regularly transferring funds for your business this is a perfect way to do so.

Security of funds

When we transfer your funds, we pay the utmost attention and provide fast and secure transfers. As a regulated firm we adhere to specific rules and regulations. We always protect your funds by operating segregated accounts.

Dedicated team of experts

We are always on hand to offer help and guide your through the process of transferring your funds. If you’re not sure about how to tackle your business’ payments, our currency experts will discuss with you and review your business’ needs and requirements, explain which currency transfer options would best suit your company and deliver tailored solutions and payment plans. They can also help identify areas where you could streamline processes and manage risks more efficiently.

Trading internationally? Save money with Universal Partners FX

If you are making international money transfers, you will need a cost-effective and secure way to do so. Universal Partners FX is the right partner for your foreign exchange. With UPFX, you can open a multi-currency account, send and receive money worldwide with low and transparent fees. You can also manage your money and send international payments 24/7 through UPFX’s easy-to-use online platform powered by Currency Cloud.

If you are an exporter or plan to start your international business, get in touch now with Universal Partners FX to find out how much you can save in your international money transfers.

Buying property in Cyprus has grown consistently over the recent years, with many Brits relocating in the Republic of Cyprus. While Covid-19 has hurt the market, interest in property continues as the market is slowly recovering. Paphos and Limassol, for example, are especially sought after as they offer amazing villas and luxury properties in beautiful locations, allowing Brits to enjoy the best of what the island has to offer. In such areas, foreigners constitute as much as 75 percent of the market. Last year, world famous Colombian pop singer Shakira and her famous partner Gerard Pique, who plays for Barcelona football club, bought an exclusive villa in the coastal village of Peyia in Paphos. Celebrities and Hollywood stars have for years chosen Cyprus for their vacations. Leonardo DiCaprio, Michael Douglas Catherine Zeta-Jones and John Malkovich, Elton John, Diana Ross and Rod Stewart are a few of the rich and famous who chose to spend their holidays on the sunny Mediterranean island.

Why Cyprus?

With Cyprus being warm all year round, having sandy beaches, and hospitable people, it is not surprising that it has become as popular as Spain’s Costa del Sol and Costa Blanca. The big difference however is that the island offers some beautiful but affordable properties.

Home prices on Cyprus are indeed much cheaper when compared to Marbella, Spain, or the Algarve in Portugal. Whereas a villa in Spain or Portugal would be about 400,000 or 450,000 euros ($475,000 to $535,000), a villa in Paphos would be half the price. Cyprus’s coastal property prices could “range from as much as $724 a square foot in Limassol district to as little as $423 a square foot in Paphos district.”

Before the pandemic, Russians and Chinese buyers were the top international buyers, with many relocating their families and acquiring European citizenship by investing in property. German, British and Scandinavian buyers, as well as buyers from Israel and the United Arab Emirates, Ukraine and South Africa have also preferred Cyprus, due to its location and its proximity to Europe.

Things to consider when buying property in Cyprus

Although some foreigners have bought houses in the illegally occupied area of Cyprus, these have usually been controversial due to the complexities and restrictions on home purchases on that part of Cyprus. As a recent article in the New York Times noted, “While European Union citizens with residency in the southern part of Cyprus can purchase unlimited properties there, others are limited to one apartment, house or plot….In northern Cyprus, the limit is four properties” but “buyers wishing to purchase a home there must confirm in advance that it actually belongs to the seller and not to a Greek Cypriot, because they may be exposed to criminal liability due to the political situation in Cyprus.”

Buyers across Cyprus should also be careful when buying a property, ensuring that the house “is free of any charges, mortgages or other encumbrances with the provincial land registry.”

When you decide to purchase a property on the island, it is usually recommended that you get in touch with a lawyer who will typically charge about 2,000 euros to serve as your local lawyer, protecting your interests and explaining the complexities of the market. When you are purchasing property, stamp duties range from 3 percent to 8 percent, depending on the property’s sale price, with the seller paying 5 percent real estate commission.

If you are considering buying your dream home in Cyprus, you should contact a foreign exchange specialist to assist you with transferring your money abroad, explain currency exchange, and hedge your funds from unpredictable currency movements. Get in touch with Universal Partners FX so you can have peace of mind when sending a large amount of money overseas. If you want to schedule ahead and safeguard your funds, talk to one of their foreign exchange experts today.

On Wednesday (03/06/20), the Euro was up against the US dollar, marking its seventh consecutive day and the “longest winning streak since December 2013.” The euro’s surge is the result of investors moving away from the US dollar as well as news that the European Commission will be helping the Eurozone economy with a 750 billion euro ($826.5 billion) fund to ease the damage from the pandemic.

The Euro had a roller coaster ride the last few years. Recently, due to slower economic growth, the Euro has dropped, but there have been signs of increase as the Covid-19 pandemic hit financial markets and investors turned towards the safety of government bonds. But soon it fell again, as investors turned to safe-haven assets such as the US dollar. Since mid-March, the euro has been at its highest after the significant decrease of new coronavirus cases in the EU.

With the continued uncertainty due to the coronavirus pandemic and the ongoing Brexit negotiations, the Euro will remain sensitive. But let’s see what the main drivers of the euro in the coming months are.

Key Drivers of the Euro

Apart from the coronavirus pandemic and Brexit updates, the Euro is sensitive to releases of macroeconomic data including GDP, unemployment rates, manufacturing and services output and consumer price indices which measure the Eurozone economy’s health. Significant events such as meetings of the European Central Bank (ECB) and updates regarding policy on interest rates and fiscal stimulus, can also impact on the single currency. For example, low interest rates are unattractive to investors.

If the US Dollar rises, as the US economy strengthens and interest rates are increased by the Federal Reserve, then this will weigh on the Euro. There are also dangers from weaker global growth and a slowing of the EU member states’ economies, especially the German economy.

Last but not least, if the Chinese economy slows and China’s trade is reduced, then there will be less demand for European imports.

European Commission forecast for the Eurozone economy

In its Spring 2020 Economic Forecast, the European Commission reported that the coronavirus pandemic will have “very severe socio-economic consequences” for the global and EU economies. It has forecast that “the euro area economy will contract by a record 7¾% in 2020 and grow by 6¼% in 2021. The EU economy is forecast to contract by 7½% in 2020 and grow by around 6% in 2021. Growth projections for the EU and euro area have been revised down by around nine percentage points compared to the Autumn 2019 Economic Forecast.”

Paolo Gentiloni, European Commissioner for the Economy, said: “Europe is experiencing an economic shock without precedent since the Great Depression. Both the depth of the recession and the strength of recovery will be uneven, conditioned by the speed at which lockdowns can be lifted, the importance of services like tourism in each economy and by each country's financial resources. Such divergence poses a threat to the single market and the euro area - yet it can be mitigated through decisive, joint European action. We must rise to this challenge.”

Economists’ Predictions in the near- and long-term

According to Citibank, “Second waves of crisis, trade wars and the ECB’s future reaction will likely keep EUR soft near term and upside capped medium term despite a lot of bad news in the price.”

In the long-term, analysts at CIBC expect the Euro to rise: “While euro sentiment remains compromised by the lack of political coherence, we’ve seen the ECB taking action by expanding its balance sheet. However, that move has been dwarfed by the additional supply of USD currently being injected into the market, which remains supportive for the EUR/USD pair.” They added that positive fund flows as a result of the Eurozone current account surplus will benefit the euro, despite political uncertainty.

Natixis Research expects Eurozone inflation to return in 2021 due to the “decline in productivity and the increase in unit production costs due to the new health standards taken because of the coronavirus pandemic.” In turn, the increase in inflation will lead to a rise in long-term interest rates which will support the euro.

If you are considering buying or selling euros, get in touch with expert currency specialists Universal Partners FX. UPFX’s friendly and dedicated foreign exchange team is available to guide you through the current volatile market and help you transfer your funds safely and fast, while providing access to the most competitive exchange rates in the market. Give them a call today to find out how much you can save on your international money transfers.

Brexit has been instrumental in the pound’s trajectory, responsible for its collapse and slow recovery. The coronavirus pandemic comes to add more pressure to the pound due to the lockdown measures and the ensuing adverse economic effects.

In the short term, as the UK grapples with the threat of Brexit and the coronavirus, the outlook looks extremely negative. But, how will the pound fair in the long term?

What’s happening now?

Sterling has been hit by Brexit and the coronavirus crisis, with the latter making its effects on the British currency very clear in mid-March, when the GBP plunged to levels not seen in 35 years with anxious traders turning towards safe havens such as the greenback. Until the pandemic is over, analysts predict that the pound will continue to be weak. At the moment, Sterling will remain reactive to headlines concerning the pandemic which has triggered the deepest decline in economic activity since 1929.

Indeed, things have changed a lot since last December when traders felt optimistic about Boris Johnson’s decisive victory in the general election, with many expecting significant progress in the Brexit talks and positive economic data.

Now, with the transition period due to expire at the end of the year and the government saying that it will not ask for an extension, the reality looks different, with the possibility of leaving without a deal posing a real threat to the pound’s future. This means that the UK could fall into a recession as economists have warned.

Short-term predictions

Georgette Boele, Senior FX Strategist at ABN AMRO has said: "In the near-term we expect another wave of risk-off in financial markets as markets are in our opinion too optimistic currently on the speed and strength of economic recovery." Boele added: “There is an enormous gap between the economic reality and what analysts forecast, on the one hand, and the optimism among investors for the second half of this year, on the other. This should support the U.S. Dollar as most liquid safe haven currency."

Long-term predictions

Following Brexit, the forecast for the pound has been dire.  As Brexit troubles are not over yet, and as the coronavirus continues to inject fear in investors, the long-term outlook for the pound is definitely bearish.

Since the June Brexit referendum, consumers have underpinned Britain’s economic expansion as businesses stopped investing. Despite the fall in the pound, consumer spending has grown since the vote, and with many businesses now closed due to the coronavirus, understandably, there are concerns for an economy so reliant on consumption.

With the economy hurt due to lockdown restrictions and a lack of exit strategy, the pound will be under pressure for the long term.

GBP: Investors turn bearish

In the Financial Times article “Investors turn bearish on the pound,” Philip Georgiadis writes that investors are anticipating further falls for the pound and have “increased their bets against the UK pound to the highest level of the year, raising the spectre of a new bout of volatility for the currency.” According to the article, “fund managers and other companies betting in the futures market have turned bearish as concerns over Brexit rise in parallel with the damage the coronavirus pandemic is causing the UK economy.”

Similarly pessimistic is Rabobank which says: “Additionally, insofar as no real progress was made on the last round of post-Brexit talks between the UK and the EU and given that the summer deadline for any request for an extension to the transition phase is looming, it is difficult to be optimistic on GBP.”

Analysts at Danske Bank also find that in the coming months the pound will remain under pressure as “Time spent fighting the coronavirus by both the UK and the EU means less time to negotiate a deal before the end of the year, increasing the risk of a big trade shock by 1 January 2021.”

While overly optimistic valuations might fall to meet reality and as such drive the pound lower, there is also the possibility of the British currency strengthening as the global outlook improves. Sterling’s weakness due to global uncertainty could be reversed as nations successfully fight the virus and recover.

What is certain, is that there are no certainties and the pound could easily come under pressure as optimism withers.

How UPFX can help

If you have a Sterling transfer, wish to better understand the market outlook or want to discuss your FX needs with a foreign exchange currency specialist, please get in touch with Universal Partners FX.

With UPFX you can save money on your international currency transfers, access competitive exchange rates and a dedicated customer service.

Boris Johnson doesn’t like to give up easily, so his latest promise is that the UK will complete a free trade agreement with the EU by 31 December next year. As he has stated, if he wins the election in December, the UK will be able to strike a free-trade agreement within just 12 months.

Is this possible?

According to the Financial Times, “few trade experts believe this is possible.” The reason being is the difficulty of having an agreement ready in such a short time, especially considering Brexit happening in January, and a transition period lasting until 31 December 2020. If this is the case, the article argues, the UK and EU would need to have agreed on “a comprehensive trade agreement by the end of next year. If they haven't, the UK in effect falls out of the EU with no deal. Most trade experts say a free trade agreement can’t be concluded that quickly.”

For many Brexiters, the UK wants to complete a similar kind of agreement as the Canada plus one, which took seven years for the EU to conclude and which will need the approval of all 27 remaining EU states.

Managing director of Eurasia Group Mujtaba Rahman has confirmed the impossibility of agreeing any trade agreement between the UK and EU. Talking to the FT, he said: “Remember this will be a trade agreement unlike any before. Normally trade agreements are designed to promote economic convergence. This one will be about managing divergence. That’s much more complicated.” 

As the government is not open to extending the transition period beyond the start of 2021, Johnson will have to win the election with a majority, something that will again open the possibility of a no-deal Brexit.

A Canada style free-trade deal

Boris is not looking for a close economic partnership, but rather for a trade agreement similar to the so-called Canada plus agreement, that will define the UK’s future relationship with the EU. Canada’s trade agreement with the EU is considered one of the most ambitious ones and is officially called the Comprehensive Economic and Trade Agreement (CETA). IT was signed in 2016 and was enforced in September. However, it hasn’t been ratified yet by all the countries, a step that could take several years.

The specific Canada trade deal has helped increase exports to Canada with Canada’s Minister of International Trade Diversification Jim Carr stating that: "At the Port of Montreal alone, we have seen 20% more traffic in goods headed across the Atlantic. This enormous step in growth for Canada and the EU has been the reason why new shipping lanes have been added to accommodate container traffic."

According to the deal, 98% of all tariffs on goods traded between Canada and the EU are duty free, something however, that, does not mean no border controls. Additionally, when it comes to the financial services, CETA does not offer anything that is not already covered by World Trade Organization rules. There is no"passporting" rights that will allow Canadian financial companies to sell their services in EU member states. Finally, there will still be tariffs on some products and quotas on certain agricultural products.

Not Ideal for UK and EU exporters

A Canada plus-type agreement might enable the UK to leave the EU customs union and decide on its own tariff rates, but it won’t necessarily solve all the issues faced by UK and EU exporters. There will be costs and additional bureaucratic documentation that will be too complicated or costly for companies.

EU: Any future trade agreement will be “difficult”

The European Union's Brexit negotiator Michel Barnier talking on Tuesday at the Web Summit, in Lisbon, said that negotiations on a future trading relationship with Britain would be "difficult and demanding," as the EU "will not tolerate unfair competitive advantage." "The UK should not think that zero tariffs, zero quotas will be enough," and that time would be "extremely short" for negotiations. He added that the UK still faced the threat of a no-deal Brexit: “Even when the [Brexit] deal is ratified it will not be the end of the story ... We have to build a new partnership with the UK after they withdraw."

Are you a UK or EU importer and exporter?

If your business is trading in the EU, Brexit poses a significant challenge to your cross-border operations and financial transactions. Universal Partners FX can help you protect your international money transfers during volatile periods as well as offer access to some of the most competitive exchange rates in the market. Get in touch with them today to find out all the benefits of transferring your funds with them.

For many British expats, buying property in Portugal remains a top priority despite the uncertainties of Brexit. From Lisbon to Porto, Chaves and Lagos, Portugal’s most popular locations continue to seduce British expats who emigrate in the country to enjoy the warm summers and uncrowded cities offering quality of life and delicious cuisine. Just think of Portugal’s iconic Fado music, Port wine, Algarve’s beaches and the delicious pastel de nata; Portugal’s charms can easily convince anyone to move there.

Whether you are looking for a villa or a beachside property, it’s important to be aware of the legal processes, costs, taxes and other fees involved in buying property in Portugal. Here’s some helpful tips to get you started.

The property market, residence and Brexit

The property market is now growing steadily and buying a property in a good location will count as a good investment.

In the last decade, around three-quarters of people own their own home in Portugal. As there are no restrictions on owning foreign property, EU citizens can buy their property easily. Around 50,000 Brits have been living in Portugal.

Especially if they can afford it, they can apply for a golden visa, which will allow them to live there for five years if they invest in a property worth a minimum of EUR 500,000000 (or EUR 350,000 for redevelopment in an urban renovation zone). After the period of five years, they will be able to apply for permanent residency. If you’re applying for a golden visa, you’ll need to reside in Portugal for at least seven days in the first year and 14 or more days in the following years.

In general, if you have been living in Portugal for five years you can apply for a permanent residence status, and after six years, for Portuguese citizenship as Portugal allows dual citizenship.

With Brexit, British citizens might lose some of the freedoms they enjoyed under the EU. While buying a holiday home and not moving in Portugal permanently won’t change after Brexit, there might be more bureaucratic processes, including applying for the visa waiver ETIAS scheme (European Travel Information and Authorization System). This is a completely new electronic system expected to be in place by 2021, which will keep track of visitors from countries who do not need a visa to enter the Schengen Zone. This means that you'll be limited to 90 days in any 180-day period within the Schengen area.

According to the Portuguese Prime Minister, Antonio Costa, the rights of British citizens who live or invest in Portugal will be protected. With the two countries’ close relationship and Portuguese economy depending on tourism and construction, British citizens’ rights might not be under threat.

Fiscal Number

To buy a property in Portugal, you’ll need to apply for a Personal Fiscal Number (Número de Identificação Fiscal (NIF), or Número de Contribuinte), a tax identification number issued to anyone conducting official business in Portugal. Whether investing in property, living or being involved in any form of business in Portugal, you will need to have a Portuguese fiscal number. For example, if you are buying a property with your partner and your names are both on the title deeds, then you will both need to have a Portuguese tax identification number. 

How much do properties cost in Portugal?

Location will naturally affect the property price, with Lisbon and the Algarve’s coastal areas being the most popular and expensive areas.  A villa in Lisbon and Algarve will cost you around €400,000 and €300,000 respectively, while a small apartment will be around €130,000 in either of these two locations. You have to consider that your expenses will increase depending on the property’s price. The more expensive your home, the more you will have to pay in property taxes, based on a property’s fiscal value. If you are looking for a bargain, heading towards the central region of Portugal, will offer you the advantage of lovely big homes at lower prices.  Compared to the Algarve, the Silver Coast is also a beautiful and cheaper alternative.

Universal Partners FX

If you have found your dream home in Portugal and you want to transfer your deposit from abroad, then you need expert help from a currency specialist firm such as Universal Partners FX. UPFX can help you make all your international money transfers safely and fast. Get in touch with their dedicated currency dealers to get access to bank-beating exchange rates and find out how much they can save you on your international currency transfers.

Buying property in France is a big commitment, considering the complexities of Brexit and living abroad. Despite, however, that the UK is leaving the EU, Brits continue to buy homes in France for permanent residence or for visiting during their holidays. For the Brits who already own a house in France, the same rules will apply, but after Brexit, different property regulations might apply for non-EU members.

What to do in the meantime?

If you are moving to France or already living there, you should register as a resident and also for healthcare. Make sure that your passport is valid for travelling.

Residency

Currently, you can still apply for a European carte de séjour at your local prefecture, as préfectures will continue to accept applications and issue EU cartes de séjour to UK nationals. After Brexit, however, and despite having your European carte de séjour, you will need to get a different residence permit depending on your situation. For example, you could be a UK national waiting for French nationality or a UK national married to, or in a civil partnership with, a French national.

In the case of a no deal Brexit, and after the new system is launched, UK nationals who have lived in France for at least five years and have a permanent carte de séjour will be able to exchange it for the new card easily.

Buying property in France

Rural France is of course much cheaper than Paris or popular areas such as Lyon or Bordeaux. Dordogne, Languedoc-Roussillon, Toulouse, Provence-Alpes-Côte d'Azur and Brittany are some of the areas particularly popular among British expats. In the Dordogne, Nouvelle-Aquitaine, for example, an average property price is €111,000. However, when you are interested in cheaper properties, you should look at more rural areas such as Nièvre, Burgundy-Franche-Comté. There, the average property price is €85,400, whereas in Indre, Centre-Val de Loire, an average property price is €80,000. In Creuse, Nouvelle-Aquitaine, one of the cheapest departments in France for property an average property can cost around €66,000 and in Cantal, Auvergne-Rhône-Alpes, you can get a property for €86,500.

What to consider before purchasing

Before buying your dream home abroad, you should consider a few things. First, you will need to think about who is buying (wife/husband) and what happens in the case of the owner dying. Then is the important issue of financing your move and buying the property, which can also mean borrowing funds or selling your property back in the UK.

It is significant that you take your time before signing any binding contract, so you understand the terms and conditions, the property itself and your rights. Find out as much as you can about the property, its surrounding area and any pending development plans that might alter the landscape, your property’s views or its future price.

For building a property, or for any renovations, make sure you have a planning permission or immediately consult an official from the relevant department. Your architect or engineer should be able to direct you accordingly. French land is classified according to the kind of planning zone within which it falls, and it can range from NC (non-constructible), through NA and NB on to UB and other urban classifications. This means that its classification will determine the amount of floor space which you will be allowed to build on that land.

Currency matters

Other very important considerations are transferring funds to buy your property and choosing a reliable foreign exchange specialist for doing so. Currently, anyone buying property abroad will find that the pound to euro exchange rates continue to be unpredictable.  Risks of a notable decline in the pound due to fears of a no deal Brexit continue. On Wednesday, this was mostly felt after Prime Minister Boris Johnson told MPs that he won’t be asking for an extension to Brexit if Parliament does not pass a Brexit deal on 19 October.

With the currency market continuing to be volatile, the best option is to get help from an expert currency broker such as Universal Partners FX.

UPFX can assist you with your international currency transfers, making the process easy, fast and cost-effective. Whether you will need to make multiple transfers or a large currency transfer, a volatile and unpredictable market can significantly affect the value of your funds, especially when exchanging it into foreign currencies. Get in touch with them today to find out how they can help you.

With Britain’s future trade relationships in question, and a no-deal Brexit looming on the horizon, the government has been preparing for post-Brexit agreements in an attempt to minimise the effects of Brexit.

New Zealand and Britain trade deal

On Monday, Britain’s Trade Minister Liz Truss said that striking a trade deal with New Zealand would be a priority, as officials are working to create continuity and support their non-EU trading partners. Truss, is on a three-nation tour, which includes New Zealand, Australia and Japan, a trip that hopes to pave the way for trade negotiations after Brexit. Ahead of her trip, Truss said: “We’re going to be leaving the European Union on October 31 with or without a deal and as part of that agenda, striking trade deals much more broadly than we have been doing is going to be vitally important. Striking a free trade deal with New Zealand is a very important priority for the UK. It’s one of the first trade deals we expect to strike.”

Official data shows that trade between New Zealand and Britain is at about NZ$6 billion (£3.1 billion), with New Zealand being Britain’s 43rd largest trading partner in 2017.

New Zealand’s Trade and Export Growth Minister David Parker said that he wanted to find a way that will retain the existing advantages of New Zealand traders despite Brexit. Parker said that among the subjects discussed, were finding ways to cooperate such as Britain’s potential accession to the Comprehensive and Progressive Trans-Pacific Partnership (CPTPP).

Businesses preparing for Brexit

If the UK leaves the EU without a withdrawal agreement, it will be treated as a non-EU country. For this reason, it is significant that businesses in the EU prepare for this eventuality, if they have not already done so. Businesses that sell to, buy from, or move through the UK, goods, supplies or services will be affected.

Customs duties and restrictions

Without a transitional period, the UK will revert to the WTO rules. This will mean “declarations will have to be lodged and customs authorities may require guarantees for potential or existing customs debts; Customs duties will apply to goods entering the EU from the United Kingdom, without preferences. Prohibitions or restrictions may also apply to some goods entering the EU from the United Kingdom, which means that import or export licences might be required.”  No longer valid will be UK import and export licences, UK authorisations for customs simplifications or procedures and Authorised Economic Operator (AEO) authorisations. There will be VAT charges for imports of goods entering the EU from the UK, while exports to the UK will be exempt from VAT. Additionally many rules regarding declaration and payment of VAT will change.

It won’t be easy to move goods to the UK, as that it will require an export declaration. Movement of excise goods from the United Kingdom to the EU will have to go through customs before a movement under Excise Movement and Control System(EMCS) can commence.

UK businesses

UK businesses then that export, import or move goods and services through the UK will need to prepare by completing relevant documents so that the transition to post-Brexit Britain is as smooth as possible.

If you are an importer or exporter and are concerned about the weakening pound as well as unpredictable political developments regarding Brexit, get in touch with Universal Partners FX. UPFX can assist you with the complexities of cross-border payments and regular transfers, as well as hedge your funds against volatile currency market movements. Give them a call today to find out how they can help you save on your international currency transfers.

The release of the UK's GDP with a better-than-expected 0.3% growth in July, has raised chances of the UK avoiding a recession and boosted the pound. Data from the Office for National Statistics showed that all sectors of the economy grew in the month – the first of the third quarter, with manufacturing also expanding by 0.3%, and the industrial sector growing by 0.1% during the month. However, the last three months the GDP has remained flat, as Brexit uncertainty has impacted on investment.

This is why, despite Brexit recession fears having eased, the economy remains under pressure. For example, the services sector growth might be an indication that businesses are stockpiling in preparation for Brexit as its outcome continues to be unknown. Plus, as many economists indicate, it is unclear for how long growth will continue.

KPMG report  

As accountancy firm KPMG forecasted, there is a possibility of Britain falling into a recession in 2020 if it leaves the EU without a deal. According to the firm, a no-deal Brexit will negatively affect the UK’s trade and business confidence and lead to the economy shrinking by 1.5% in 2020. The accountancy giant is not the first to warn of the negative effects of Brexit on the economy, as experts have already underlined the grim economic outlook for Britain.

Forecasts by the Bank of England and the Office for Budget Responsibility, have also highlighted the negative economic consequences of a no-deal Brexit and, consequently, of losing access to the EU single market and customs union.

The possible recession will cause a rise in unemployment, a decline in consumer spending and an estimated 6 percent slide in house prices, the KPMG report added.

Yael Selfin, the  KPMG’s chief economist noted that in the case of a recession resulting from a no-deal Brexit, the decline in the pound’s exchange rate will “push up inflation to above the Bank of England’s 2 per cent target, potentially forcing the central bank to lower its key interest rate to near zero.”  With the central bank’s key rate currently standing at 0.75 per cent, interest rate cuts will possibly be no higher than 1 percentage point.

The report also said: “[The new government’s] resolve to leave the EU by 31 October has become increasingly clear . . . and the proximity of the date make the outlook for the next two years rather bipolar.” KPMG added that the pound’s 10 percent expected decline in value, will hurt even exporters as issues over borders will eliminate any positive effect the weaker currency might have. Selfin said: “The most damaging impacts could come from potential shortages of imported foodstuffs as well as medicines in the immediate term, negatively impacting households’ sentiment.”

Selfin could not be clearer when discussing the damaging effects of a no-deal on the economy: “With the Brexit debate poised on a knife-edge, the UK economy is now at a crossroads. It is difficult to think of another time when the UK has been on the verge of two economic out-turns that are so different, but the impact of a no-deal Brexit should not be underestimated. Despite headwinds such as the slowing global economy and limited domestic capacity, the UK economy now has the potential to strengthen over the next 12 months. But a no-deal Brexit could put paid to this upside, triggering the UK’s first recession for a decade.”

Government and Bank of England will be unable to stop a recession

Indeed, the outlook looks grim as the economy contracted by 0.2 percent between April and June, with investment and growth being limited. 

On Monday (9 September), the Resolution Foundation thinktank in its assessment of the UK’s readiness to respond to the next recession, said that the government and the Bank of England were unprepared and that this was a significant risk that policy makers should take seriously. As the think tank noted: “The UK’s macroeconomic policy framework has not kept pace with significant changes to our economic environment and is therefore at risk of leaving the country underprepared for the next recession. That is not a risk policymakers should take lightly.”

 In its key findings, the think tank stressed that the country was facing the biggest risk of recession since 2007, that those of lower incomes would be the most exposed to the recession and that monetary policy will be unable to provide “anything like the level of support it has previously in recessions, reflecting what appears to be a secular decline in the level of interest rates around the world.”

Importing and exporting

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