A third of European firms to cut investment due to Brexit

LONDON – A third of European companies expect to cut investment spending due to Brexit uncertainties and a tenth of those with operations in the Britain plan to pull out of the country, a survey of 600 euro zone firms, by Swiss bank UBS, found.

Over half the companies said they did not expect Britain leaving the European Union to change their investment plans, but 24 percent anticipated reducing investment "somewhat", and 8 percent "significantly", the survey, published on Friday, showed.

Thirty-nine percent of those said they would modify their investment plans within 6-12 months, and around 17 percent said they would respond immediately.

Of the firms surveyed, in a range of sizes and sectors chosen to represent the European market, 74 percent have operations in Britain.

Of those, a tenth said they planned to relocate all their capacity away from Britain, while 31 percent said they would remove a large amount. A fifth said they would not relocate any capacity, and 3 percent planned to increase UK operations.

Euro zone countries were the most preferred new destinations for nearly half of respondents, while central and Eastern Europe was preferred by 30 percent.

The survey found uncertainty related to Brexit was top of the companies' worry list. A close second was uncertainty over the new U.S. administration, while only 14 percent were most concerned about the French presidential election.

The survey was conducted between Jan. 10 and Feb. 13. –Reuters