Buzzer
Languidly Clinical
- Oct 1, 2006
- 26,121
I keep seeing this: I'm not so sure that it will happen. The EU will surely take the longer view. "Markus Kerber, head of the BDI, dismissed claims that German companies would not tolerate trade tariffs after Britain leaves, and said Germany’s relations with the rest of the bloc were more important.
“I have read a lot of articles in the British press saying Germany would be a relatively soft negotiator because 7.5% of German exports go to Britain,” Kerber told BBC Radio 4’s today programme. “Well, 7.5% is a big number – but 92.5% goes somewhere else.”
http://www.telegraph.co.uk/news/201...ot-save-britain-from-hard-brexit-warns-merke/
https://www.theguardian.com/politics/2016/sep/29/german-business-leader-warning-brexit-trade-uk
My gut feel is that all sides are just talking up their negotiationing position but it would be economic suicide for either side to try to play too hard. Kerber is right, 7.5% is a huge amount and if they do make it so hard for us to buy EU goods then even a 2 or 3% drop could plunge Germany into recession. The UK is still the fastest growing economy in Europe and right now the Germans need to maintain a strong and expanding economy more than ever because there's a few chickens coming home to roost - namely the banking crisis in Italy with Monte Dei Paschi being the first of a few Italian banks that will need re-structuring. And then there's Deutsche Bank.
This worries me far more than Trump or Putin or Brexit. As a regular traveller to German businesses what's the feeling about their biggest bank. Are the Germans particularly worried about it? The banking crisis in Italy alone should be causing sleepless nights - Italy are one of the few big net contributors to the EU and with the loss of the UK's money, if Italy go from being a net contributor to net taker then that's another massive blow to the European Project.