‘Brexit, so what?’ German firms expect little fallout

A large majority of German companies expect Britain’s divorce from the European Union to cause little if any damage to their business, according to a poll published by the Cologne Institute for Economic Research (IW) yesterday. Germany, the EU’s largest economy, has stressed the importance of maintaining open trade ties with Britain after it leaves the bloc. Finance Minister Wolfgang Schaeuble said last week the German government would try to minimize any damage to both the EU and Britain during the Brexit negotiations. However, the IW survey, entitled “Brexit, so what?” found that more than 90 percent of the 2,900 companies surveyed either said they expected no damage at all or very little harm.

Only two to three percent - mainly companies in the industrial sector - said they expected Brexit to have a major impact on their investments and workforce. About a fourth of those polled said they expect Brexit to have a positive effect, some saying that it could for example lead to a rise in foreign investment in Germany.

The findings contrasted with expressions of concern from German car makers and farmers, among others, about the possible negative impact of a “hard Brexit” - in which Britain would also lose the EU’s single market - on bilateral trade. Britain is Germany’s third-largest export market after the United States and France. Exports to Britain stood at 80 billion euros in the first 11 months of last year. British Prime Minister Theresa May made clear last week that Britain would indeed quit the single market in order to regain full control of its laws and its borders.