German Business Groups: Prepare For No-Deal Brexit

Some German business groups have told their members to step up their preparations for a hard Brexit that would see the United Kingdom crash out of the European Union in 2019 without being able to negotiate a deal.

Last week, Theresa May, the British Prime Minister, was able to secure a cabinet agreement for “a business-friendly” proposal to withdraw from the European Union that is aimed at spurring the delayed Brexit discussions. However, the hard-won compromise has unfortunately come under fire from within her own governing Conservative Party and may still fall flat with the negotiators from the European Union.

The managing director of the BDI, Joachim Lang, said to the Welt am Sonntag newspaper: “Even if the British government is moving now, companies must plan for the scenario in which there is no agreement.” BDI is the biggest industry lobby of Germany.

The managing director of the VDMA engineering association, Thilo Brodtmann, said to the same newspaper agency: “It is urgent to prepare for Brexit and to expect the worst case scenario.”

The German industry is worried about the increased friction the in trade with the United Kingdom after Brexit. The United Kingdom is the second-biggest export market for the car manufacturers of Germany.

However, Lang said that some businesses in Germany were only just beginning to analyse what Brexit would mean for them. He added: “At least that has moved us forward from a few months ago.”

On the other hand, Brodtmann warned that engineering companies are against being lured into a sense of complacency by stable business in the United Kingdom now.

He stated: “Brexit is such a big nonsense that many companies still hope it will not be that bad because the EU will not allow a hard landing for the economy. But I can only warn against that.”