After the UK elections, the German Mechanical Engineering Industry Association (VDMA) expressed concerns about its effects on the upcoming Brexit negotiations.
“The uncertain political situation after the election in Great Britain will further complicate Brexit negotiations. This is bad news for mechanical engineering in Germany,” Thilo Brodtmann, executive director of the VDMA, said. “The future British government will not have a clear majority and therefore have little room to negotiate. The British government will have a hard time with starting negotiations as planned on June 19. Therefore, the risk of not coming to an agreement after two years of negotiations is increasing.”
If the Brexit negotiations fail, considerable impairments on trade, or even complete stagnation, loom on the horizon for after March 2019. “In light of the already extremely short deadline for Britain’s exit from the EU, the new British government must quickly find a way to limit the damage to its economy,” says the Executive Director of the VDMA.
Last year, the UK was the fourth-largest foreign market for mechanical engineering companies from Germany with an export volume of EUR7.3 billion, and the sixth most important foreign investment location. The UK delivered mechanical engineering products worth EUR2.4 billion to Germany in 2016.