Today, the head of an influential business lobby group that is based in Germany warned that Europe would potentially fall into a “huge crisis” in the event of a hard Brexit.
During a news conference that was held in Berlin today, Joachim Lang, the managing director of the BDI industry association said that a breakthrough in Brexit talks must be achieved at the upcoming European Union summit in Brussels that is scheduled on the 17th and 18th of October.
He added: “Otherwise there is the risk that Europe slides into a disorderly Brexit and that would cause a huge crisis.”
Lang said that a hard Brexit would potentially result in major problems for tens of thousands of firms in Europe and hundreds of thousands of employees in the United Kingdom and the European Union.
He said that a transition period, which would be required to be part of a Brexit deal, was essential to enable German companies to adapt to the legal changes that the withdrawal of the United Kingdom from the European Union would introduce.
He stated: “A strong agreement with the EU is far more important for both sides, especially for Britain than the remote prospect of deals with third countries.”
Also today, IW Institute, a German economic body, also warned regarding the results of a hard Brexit. It said that German companies would likely face tariffs of more then €3 billion (£2.6 billion) per year if the United Kingdom leaves the European Union without a deal.
IW said that aA hard Brexit would greatly affect the German auto sector which represents approximately 60 percent of the additional costs that German companies would potentially face.
Markos Jung, a researcher from IW, said that the possibility of a decline in German exports to the United Kingdom in the event of a hard Brexit was a “horrific scenario” which “should force politicians to act constructively.”