It’s way too early to know how history will judge Boris Johnson. In fact, it’s way too early to know how voters will judge him at the next election when the Brexit process should be complete and the new normal established. It is, however, not too early to take a look at what is likely to happen between now and then and what it could mean for the economy and hence for investors.
Five years of stable government
Assuming the Fixed-Term Parliament Act remains in place and barring unexpected events (such as the government losing a confidence vote), we can expect to have the same party in government until December 2024.
Of course, that doesn’t necessarily mean that we’re going to have the same people in charge of the same functions for the next five years. There has already been one cabinet reshuffle and the government is barely months old. It doesn’t even necessarily mean we’ll have the same prime minister, although at present, it’s hard to see why Boris Johnson would resign or who would be able to force him out (or how they would do it).
It does, however, mean that we should see policy decisions made by people within the same party and thus at least have an idea of the general direction of travel for the next five years. This is extremely useful for being able to plan. That’s good news for everyone, including, and arguably especially, businesspeople and investors.
Brexit will happen
In principle, the UK will be out of the EU by this time next year, with or without a deal and we’ll all be discovering what a post-Brexit world looks like. In practice, of course, given the length of time, it’s taken to get this far, there’s absolutely no guarantee that the UK’s departure from the EU will happen to schedule. That said, Boris Johnson was very firmly in the leave camp and has stated his commitment to getting Brexit over the finish-line promptly. He is also in a strong position to get any deal he supports through the UK parliament since he has a working majority.
Regardless of your views on Brexit, it will hopefully be a relief to know what the future has in store so that you can decide what, if anything, you want (or need) to do about it. This is likely to be particularly true for anyone involved in the property market, especially investors, who have to think about all the standard considerations relating to property purchases (upfront costs, administration, potentially financing), plus business-related considerations such as likely yield, which is dependent on various factors, including, of course, taxation.
While there are never any guarantees, especially not when heading into uncharted waters such as Brexit, which could prove to be expensive, at least in the short term, the Conservatives have long billed themselves as the party of enterprise and free-market economies rather than the proponents of “tax-and-spend” socialism. This suggests that, at the very least, they are not going to go out of their way to target investors.
HS2 will happen
Despite all the environmental and financial controversy, HS2 is going to happen. If it delivers the benefits promised, it may turn out to be the crowning glory of Boris Johnson’s tenure as prime minister. If it doesn’t, it may sink his chances of reelection.
One way or another, however, it seems highly likely that HS2 will be a major feature of the UK’s political and economic landscape during the coming years and may present some very interesting opportunities for investors (or some serious threats). Investors may, therefore, wish to keep a close eye on developments relating to HS2 and, indeed, to the creation of new infrastructure in general which may turn out to be a key plank of Johnson’s strategy for reelection.