It’s been nearly four months since the UK voted to exit the EU, leaving the events industry in a state of shock. While the initial hysteria has died down, we’re still left with more questions than answers. Over the next two days, C&IT will share its investigations into the impact of the vote on global travel and inbound and outbound events, with four key themes emerging. First up we look at the fall of the pound and the political and business impact.
FALL OF THE POUND
"The weakening pound has had some effect on programmes we’re operating, with companies having to scale back as the exchange rates are taking them over budget," Henriette Speed, director at Just the Letter B
Once the Brexit vote was counted, the British pound began its steep fall. Three months on, the picture is no clearer.
For some, such as Natalie Crampton, director at Dubai-based agency TEC, the purse strings have already been tightened, with the plummeting pound affecting clients’ budgets.
"When converted into Emirati dirham or other Gulf Cooperation Council currencies the pound is worth significantly less in local currency post-Brexit. We have seen clients scale back because they can no longer afford the luxuries or finishing touches they would have had previously," she explains.
However, as quickly as budgets for oversees events have shrunk, the opposite has happened to projects coming back the other way.
"We have noticed a shift, with one of our key automotive clients saying they would now consider the UK as a destination for events," says Muriel Holdsworth, managing director, EMEA, Invnt.
In some instances this has even caused a scramble for clients wanting to pay up, while the exchange rate is so favourable. "If anything, the referendum result has been positive for our international clients – several of whom have called us to arrange early payments for their events to take advantage of the preferential exchange rate," says Excel London’s executive director James Rees.
"Brexit creates a lack of visibility and investors simply hate uncertainty... In other words, the luxury market is definitely getting impacted" Frantz Yveli, CEO at La Compagnie
With political uncertainty leading to jitters in the business world, some agencies fear Brexit is having a ‘knock-on’ effect elsewhere in the world. "In the US, we’ve noticed that clients are choosing to stay put at the moment, rather than travel outside of the US," explains Robson.
"We think the uncertainty surrounding the US elections is impacting this, as well as the issue of Brexit. Businesses in the UK were so complacent about remaining in the EU, I think our vote has added to the jitters and insecurity in the US surrounding their elections – it proves that anything can happen." She adds that whatever the outcome, the US is aware that its relationship with the UK will change as new trade deals are negotiated and the uncertainty is causing concern.
For some companies, the business impact of the vote is already being felt. Luxury business class airline La Compagnie recently announced the suspension of its flights between the UK and New York.
"Brexit creates a lack of visibility and investors simply hate uncertainty. So that means several companies with significant revenues won’t have revenues or would have less revenues," says CEO of La Compagnie, Frantz Yveli. "In other words, the luxury market is definitely getting impacted."
He adds that the company still believed in the UK and would resume flights when the period of political and financial insecurity was over.
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