Amazon’s UK Manager, Douglas Gurr, has warned the British government that failure to secure a Brexit deal could have massive repercussions as Amazon announces new jobs in the country.
Gurr held a private meeting with key figures in the government on Friday. National newspapers reported over the weekend that he said during this closed-door meeting that securing a deal with the European Union upon Britain’s exit is vital to prevent the threat of “civil unrest”.
The e-commerce giant is still planning for operations in the UK after Brexit, announcing the creation of up to 2,500 jobs in its sites across the country. Gurr’s warning, however, appeared to have caught government figures by surprise, with one newspaper commenting that the verdict “stunned those present”.
In a statement, Amazon confirmed that it would “consider a wide range of scenarios in planning decisions” so that it can carry on its day-to-day operations and limit the impact to small businesses that have come to rely on its services, regardless of the likelihood of each option that it might predict. Amazon said that this practice does not stem from any particular issue, and it is how the company deals with business, economic and political climates around the world.
UK Prime Minister Theresa May is currently battling her own party as much as the EU, as a wave of resignations in the last month seem to highlight how difficult it appears to put a deal on the table that suits all parties involved.
Both May and Dominic Raab, the new Brexit Secretary (replacing David Davis, who resigned earlier this month), have said that they are prepared to leave the European Union without having a deal in place. Whether that statement is down to bargaining techniques is hard to say at present.
Should such a “no-deal” Brexit go ahead, any imports and exports to and from the UK would be subject to World Trade Organization (WTO) tariffs, which would likely have an immediate effect on the sourcing of food and medicine and even affect UK citizens’ ability to travel in and out of Europe by plane.
With Amazon already planning to increase its workforce to a 27,500-strong unit across the UK, it is one of the few big businesses happy to commit to Britain even while there is such uncertainty. Many financial entities are already planning to move their head operations out of the country.
In a press release, Gurr called the UK a “fantastic place to do business” but added that Amazon’s main concern is that the businesses that they work with in the country can also carry out their own work. Gurr added that although Amazon is unsure as to what will happen with Brexit, its only real option is to “adapt as necessary”.
Amazon’s supply chain is likely to see the implications of a no-deal Brexit, as resources that it would typically outsource may become harder to access or maintain securely and reliably.
The company could also experience the negative effects of a potential downturn in consumer spending. With inflation having tapered off since its rise post-June 2016, these fears have lessened for now. Amazon is offering cheaper rates for products than many of its competitors can afford, so it may find itself well-placed regardless of the Brexit outcome.