Leading German business organizations expressed relief that Britain and the European Union had struck a last-minute deal over the terms of Britain’s departure from the 28-nation trading bloc, and urged both sides to pursue the more important question of how trade will work once the terms of Brexit are sealed.
Earlier on Friday, the European Commission said enough progress had been made after the two sides worked through the night to end an impasse over the status of the Irish border, easing the pressure on UK Prime Minister Theresa May. The Irish issue was the last major obstacle to opening trade talks with the EU, a step leaders are widely expected to approve at a Brussels summit on December 14-15.
“I assume that we have reached the breakthrough we needed,” said Commission President Jean-Claude Juncker in Brussels, who added that much remained to be done. Comments from Berlin echoed that sentiment. “I think everyone understands that there is still much work for negotiators to do even if the European Council decides to move into phase two of Brexit negotiations,” German government spokesman Steffen Seibert said.
Dario Pignatelli
BRUSSELS MAY
According to the EU’s chief Brexit negotiator, Michel Barnier, the terms of Brexit must be agreed by October 2018 to be binding. Britain is currently set to relinquish its EU membership on March 29, 2019 and enter a two-year Brexit transition phase.
“Consensus over the exit terms clears the way for the issues that companies are dying to discuss,” said Eric Schweitzer, head of the German chambers of commerce, known here by the acronym DIHK. Next on the agenda are key matters of how to deal with border customs, the movement of skilled personnel, and safeguards for existing contracts for loans and insurance, he said. “A lot is at stake for German business,” Mr. Schweitzer added. “The UK is Germany’s fifth-biggest trading partner with goods turnover of more than €120 billion last year.”
Today’s news assuaged fears that companies on both sides of the English Channel might face a so-called “hard Brexit,” the departure of the UK with virtually no trade deals in place to replace the advantages of EU membership. In recent months, German business associations voiced increasing alarm at the lack of progress, and they weren’t alone. On the eve of Ms. May’s meeting in Brussels, Paul Drechsler, head of the British business lobby CBI, warned that 60 percent of firms with Brexit contingency plans would activate them by Easter 2018 unless the UK got the green light for trade talks with the EU.
Joachim Lang, director of the German industry federation BDI, said he was relieved but that the next round of talks should be pursued with renewed verve. “The most difficult part of the negotiations still lies ahead,” he said. “London shouldn’t delude itself. Our companies need to know quickly which model Downing Street sees for a future treaty and what the transition phase will look like.”