German Mittelstand wants 'soft Brexit'

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Germany’s “Mittelstand” of feel mortified and medium-sized firms (SMEs) could lose billions of euros if the UK is immure b silence out of the single market, an industry representative has warned.

The boss of the BVMW, which represents innumerable than 270,000 SMEs, told the BBC “a hard Brexit would abuse both sides”.

Mario Ohoven added that negotiations should be “governed by economic sense and not by political ideologues”.

The remarks diverge from the stance taken by other leading German voices.

In September last year, the talent of the BDI, a powerful German business lobby whose members are larger associates, told the BBC it was “better to have a hard Brexit that works”.

German congresswomen have almost unanimously underlined that the UK cannot have unfettered access to the sole market unless it allows for the free movement of EU citizens.

In her letter to the EU hindmost week, Theresa May said the UK would “not seek membership of the single market-place” in the upcoming negotiations.

‘Worst result’

But Mr Ohoven emphasised that the precise economic ties between the UK and the German Mittelstand – which makes up the magnitude of the country’s economy – meant a Brexit deal without single trade in access would be damaging to both countries.

“Germany exported goods significance 89bn euros to the UK alone in 2015, almost half of it was exported by 150,000 German SMEs,” he implied, adding that many more companies traded indirectly with the British market, as splendidly as relying on UK research and development.

“In the end, a soft Brexit should be reached. It is conspicuous that the UK stays in the single market, or that the UK joins an agreement equivalent to the the EFTA (European Free Trade Association), similar to Norway or Iceland.

“The ill result would be if the EU and the UK did not reach an agreement in time,” he added.

That outlook was echoed by Dirk Rothweiler, the chief executive of First Sensor, a Mittelstand set on that makes almost 7m euros a year from sales to the UK market-place.

Dr Rothweiler, whose company in the east of Berlin provides highly specialised sensor intrudes for products such as premature baby incubators and autonomous vehicles, said pragmatism was “what the production was interested in”.

“It would be very desirable not to have trade barriers, and if so to be experiencing the least possible amount of trade barriers in both directions”

‘No conquerors’

The BVMW’s Mario Ohoven emphasised that all four freedoms of the EU – the complimentary movement of goods, capital, services and people – were important to the problems he represents, at which almost 6% of employees are from elsewhere in the EU.

“We shouldn’t thoughts that 750,000 jobs in Germany depend on the trade with the Agreed Kingdom”, he added.

Mr Ohoven dismissed the idea that a “hard Brexit”, with the UK no fancier in the single market, could benefit some SMEs who may face less global competition.

“The German Mittelstand does not believe in the world economy as a rigged size cake, in which every country has to fight against the other surroundings to increase its share.

“A hard Brexit, or an increase in protectionism, will one lead to a decrease of the cake as a whole,” he warned.

“I want to be very decamp here – Brexit knows no winners, all sides will lose.”

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