From Bonn to Berlin, German bosses are as sick of Brussels bully boys as we are
That’s the thundering message ROBERT HARDMAN heard from a nation fed up with EU nabobs putting ideology – and the risk of a no-deal Brexit – before jobs
NO ONE in these parts is a fan of Brexit — not even the local candidate for the far-Right anti-Europe party, Alternative fur Deutschland.
Here in Bavaria, Germany’s largest state and the engine room of the European economy, they still can’t quite believe that the dependable, sensible old Brits would really rather tootle off on their own than stay with them in the club. To a man and woman, they would be thrilled if Britain called the whole thing off.
But having said that, there are few breeds more practical and matter-offact than the German business executive. And he — or she — has a clear message for Michel Barnier, Jean-Claude Juncker, Donald Tusk and the rest of the EU uber- elite — particularly the French President, Emmanuel Macron. It can be summed up as follows: ‘For Heaven’s sake, stop trying to humiliate Theresa May and strike a deal with her. If not, we’re all in trouble.’
Or as Munich entrepreneur Bernhard Erdl tells me: ‘Brexit happened because the EU did not take David Cameron seriously enough. They were arrogant. And now they are being arrogant again.’
The clock is counting down to next week’s crunch EU summit in Brussels, which, in the view of many, is D-Day for Brexit. Of course, we are not due to leave the EU until next March, but if we are to avoid a serious crisis of confidence and financial jitters between now and then, industry wants to see the politicians agree some sort of framework deal by the end of the month.
A year and seven months after Mrs May triggered Article 50 and began the EU exit process, we really do find ourselves at a crucial juncture. We can (and probably will) go on haggling about the final exit terms for years, but business needs to know the boundaries pronto.
Theresa May’s Chequers deal may invoke scorn from both ends of the Brexit spectrum but, in the eyes of German industry, it is a basis for negotiation. It also involves a just-abouts wallow able answer to the problem of the Irish border. To many European businesses, it’s at least a start.
YETEU hardliners such as Macron and the arch federalists in Brussels keep throwing it back in her face. Why? Because some, like Macron, beset by plummeting popularity ratings, want to show their home audience that they are tough on the treacherous Brits.
It is also because they are deploying a dangerous strategy: the tougher the deal, the more likely (so the theory goes) that Britain will be pushed into holding a second referendum. And if that doesn’t lead to a second vote, it will certainly terrify any other country with the nerve to consider leaving the grand projet.
The knuckleduster approach may play well in Brussels and pander to the sort of Remainer zealots who want Brexit to be a total disaster so they can gloat amid the wreckage. But how does it go down in Europe, among the people who actually pay for it all?
For the answer, I have come to Bavaria. And they are clear that they don’t want Britain dragged outside for a beating. They want common sense.
Germany’s largest state is so prosperous that if it went independent, its GDP (at half a trillion pounds) would put it ahead of most countries in the world. It is the home of global brands including BMW, Audi, Siemens and Adidas.
But it is also home to thousands of smaller companies, many of them family businesses, which form the bedrock of the European economy — and which also happen to export billions of pounds worth of goods to Britain every year.
They are the widget-makers who prop up the German corporate pyramid.
They are hard- nosed commercial people, most of whom are fervent believers in the European dream. Yet they are also realists. They believe a no- deal Brexit would be disastrous for the European economy as well as for Britain because of the vast imbalance in trade. In other words, Britain buys much more from them than it sells to them.
That is why they want Europe’s politicians to cease their posturing, threatening behaviour towards the UK.
‘The UK is essential to our business, so I want a deal. The best thing is to find a solution that does not hurt either the UK or the EU. We need to protect the industry of both players,’ says Reinhold Braun, general manager of Sortimo International, a company that makes racks and shelving, employs 1,400 people and sells 20 per cent of its products to the UK.
He wants German Chancellor Angela Merkel to steer Europe round to a more conciliatory position. ‘It has to happen that Merkel steps in and pushes for a deal. It has to happen,’ says Braun. He adds that the hardline Brexiteers need to give the Prime Minister some leeway, too, as she tries to re-work her Chequers deal.
‘Is Chequers the solution? I don’t know. But it’s there, so personally I’d take it. It is something to work with — and it is getting really late in the day.’
This is a view echoed by German economists such as Wolfgang Munchau, who writes for the fiercely pro-Remain Financial Times.
Writing in the German business paper Handelsblatt last month, he warned German politicians: ‘Given the political situation in Britain, anyone who continues to call for a hard stance in talks with the British Government doesn’t have Germany’s economic interests at heart or is behaving like turkeys voting for Christmas.’ This week, the de facto spokesman for German manufacturing warned that unless Europe cuts a deal with Britain in the next month, there will be ‘disaster’ on both sides of the Channel.
‘We have to pave the way for a well-structured exit of the UK in the next four weeks,’ Joachim Lang, director-general of the German Industry Federation (BDI), declared.
The alternative was a ‘ worst- case scenario’ that ‘would put tens of thousands of companies and hundreds of thousands of workers on both sides of the Channel in the greatest difficulties’.
Note that he was not calling for a second referendum. Nor, unlike President Macron, was he invoking pious devotion to the sacred European ideals of the single market and the customs union.
To listen to French politicians, things such as the Schengen Agreement and free movement of people are somewhere up there with Thou Shalt Not Kill as an article of faith. Unless you happen to visit, say, the French-Italian border or the
German-Austrian border, where border controls are rigidly enforced (especially if you happen to be from an ethnic minority).
What is different now is that the people who actually drive and sustain the European economy are no longer wagging fingers solely at Britain. They are turning their wrath on their own.
LANG’S outburst was all the more telling because German business organisations are pretty wary of rocking the boat. They dislike sensational headlines, especially in the naughty British media.
Despite lodging requests with four separate organisations over the past fortnight, including Mr Lang’s BDI, the German-British Chamber of Commerce and two prominent Bavarian trade associations, I was offered just one company that would talk to me. Then, suddenly, that company found it was too busy after all.
So I went knocking on doors instead. And, away from the spindoctors and the lobby groups, the response was fascinating.
German businesses have not changed their view on Brexit, of course. They still think it is inexplicable, though they concede that Britain and Germany had very different ambitions right from the outset. Whereas the Brits wanted to join a trading bloc, the Germans think of Europe as a political utopia.
But these businesses also accept that we are off and there is no point in punishing us. That is why they favour helping Mrs May rather than siding with all her tormentors.
Take Bernhard Erdl, the founder, president and boss of Puls. ‘I am all for a pragmatic approach, not an idealistic one,’ says Erdl, who started his business in a Munich cellar with one other engineer in 1980. ‘ I hope all this talk of punishing Britain is just a bargaining position, not a real position.’
His company, a world leader in industrial power control units, employs 1,300 people, 300 of them in Germany. His transformative moment was getting into Asia ahead of his rivals.
‘I work with the Chinese and they are the most pragmatic people I know. In Europe, we talk about dying for our ideas.
‘The Chinese would never do that. Their main purpose is to keep the country together.’
By common consent, the moment has come for Angela Merkel to intervene. British-born engineer Richard Lawrence, who has built up a successful power repair business in Munich and raised his family here, says he has no doubt the German leader will come on board when things get what he calls ‘hypercritical’ in the coming weeks.
‘ Right now, it’s all a show. Everyone has to look like they won,’ he says. ‘ Merkel is staying out until the last moment. Once BMW start laying off workers, she’ll be in there.’
No one is keener on resolving the Brexit impasse than the German car industry. One German job in seven depends on it, and Britain is one of its biggest markets. It is not just that Britain buys so many German cars, but that so many are made in the UK.
Dr Tobias Nickel is head of corporate communications for Draxlmaier, one of the world’s biggest makers of door panels and wiring harnesses for cars.
Among the company’s major clients is Jaguar Land Rover (JLR). Such is the advanced state of car design now that his company has just three days to build each bespoke panel for every new JLR car, and must then get it from Germany to the British factory within a precise four-hour window.
Miss that slot and you hold up an entire plant, with punitive results. The idea of 30-mile traffic jams at the Channel is the stuff of nightmares. He dreads a ‘no deal’.
His company is hardly small, with 70,000 workers worldwide. Yet by German standards it is not big enough to enjoy lobbying access to the German government, unlike the car giants.
So does Dr Nickel not support the EU’s attempts to punish and grind Britain into submission? Does he not support the strong stance of European Commission President Jean-Claude Juncker?
‘Mr Juncker is from Luxembourg, which is a country that does not have a large automotive industry,’ he says carefully. ‘In the automotive industry, we are not in the business of teaching other countries a lesson. We are in the business of making cars.’
I get the same no- nonsense message from business all over Europe. Take Claudio Calabresi, who runs his family textile business near Florence, making clothes for M&S, Ted Baker and others. Up to 40 per cent of his £25 million turnover goes to Britain. A bad Brexit would be very grim indeed.
As in Germany, he wishes Brexit wasn’t happening. But he is practical, too. He places the blame for the current situation equally on the British and EU politicians and wants calm.
‘It is a very confusing situation. From my point of view, the people shouldn’t be punished,’ he says. ‘We must respect the decision — it has come from the people, not the politicians. In fact, there is a feeling in Italy that if we could take a similar decision, many might go the same way.’
In Normandy, meanwhile, political and business leaders have warned President Macron that a no-deal Brexit would threaten the region’s economy.
Herve Morin, the chairman of the regional council, wrote a public letter this week signed by ten other prominent figures in Normandy, including port and ferry operators, to demand financial help should the negotiations end without a deal. ‘A Brexit without an agreement... represents for our economy, and especially for the economy of our ports, a major threat,’ they wrote.
Back in Bavaria, I do meet some who feel that Britain deserves all it gets. But they are in a minority. Most would like to see Angela Merkel assert more authority over her EU counterparts.
After last year’s dismal performance in the general election, there is a sense that she has regained some authority at home. In Europe, she is certainly still queen bee.
BUT her standing at home may depend on this weekend’s state election here in Bavaria. For years it has been the stronghold of the Christian Social Union, the Bavarian wing of her party.
Yet her 2015 decision to open Germany’s borders to more than a million unchecked migrants has seen the CSU lose substantial ground to the far-Right AfD and it is on course for its worst result in living memory.
I meet one of the anti-migrant AfD candidates, Uli Henkel, in the Munich pub that is now his headquarters. ‘It’s my ninth bar,’ he says, explaining that protesters have driven his campaign HQ out of the previous eight.
He cannot envisage Germany ever leaving the EU, but blames Brussels for Brexit. ‘Europe should have done everything to keep the Brits in but it didn’t,’ he says.
At which point two policemen come into the pub. The AfD’s toxic, anti-Islamic message has led to car burnings, broken windows and regular protests. The cops are here to keep the peace.
It dawns on me that there is now only one major EU nation that does not have an extremist Right-wing party making serious inroads into public life.
Britain may have its faults. It may be divided. But unlike France, Germany and the rest, it can still offer a few lessons in community cohesion.
Some EU politicians may want to treat it like a pariah. Fortunately, those who pay their wages now seem to think otherwise.