German-British Chamber of Commerce statement on EU-UK trade agreement

20 January 2021

The trade deal between the UK and the EU was a much-expected Christmas present for the economy and all of us, be that in the UK or in the EU. Some may even say ‘Global Britain’ has won over ‘Little Britain’. However, depending on one´s point of view, one ‘battle’ over future cooperation may have been won, but there is much more work to do!

The difficult negotiations about a future trade deal between the UK and the EU came to a positive conclusion on 24 December 2020, something that was much welcomed by the German-British business community. We do not know all the details yet, but make no mistake, major change is still in the air and the way commercial transactions are carried out across the Channel significantly changed on 1 January 2021. From day one, trade in goods and services became more expensive and in some cases it has even come to a standstill, especially as the new immigration law took effect, making the provision of some cross-border services impossible. As always, the devil lies in the detail and many of the details have been overlooked so far or have not been given enough consideration (how to deal with many of the still unclear customs formalities serves as one immediately pressing example). Many SMEs in the UK and in Europe will find trading with one another more expensive and in some cases prohibitively so. That a comprehensive deal on the future of the relationship could not be agreed upon will come at a price; lost opportunities, not only for many smaller businesses, but also for larger ones, as the regulatory costs will start to bite even more in the months and years to come. This in turn will reduce competition and in the end will make life more costly for all of us.

However, this free trade deal is hugely important, as an acrimonious divorce between the UK and the EU would have come at an even higher cost and potentially led to an erosion of the basis for future communications across the Channel. Using Theresa May’s words, one thing is clear: Britain has left the EU, but not Europe. We must continue to work together to address global challenges, be that Covid-19, climate change, upholding the rule of law and poverty-induced global migration. We should also bear in mind that Brexit in its current form will reduce the opportunities for young people to experience other cultures. Internships, work experiences and study opportunities in the UK and in Europe will in some cases become impossible from an immigration point of view or at least more costly, especially as the financial support from the Erasmus programme will fall by the wayside. To build a future in the Europe which we inhabit together, both the EU and the UK should work on developing a new framework to enable exchange and opportunities so that individuals and businesses can continue to learn from and to get to know each other. If the next generations, unlike those in the past, do not have such opportunities, maintaining important linkages across the Channel will become more difficult and the younger generation of today will be unnecessarily deprived of opportunities. Therefore, the work is cut out for both sides to design a framework which enables opportunities, growth and prosperity for all. Both sides should be held accountable for this. The German-British Chamber of Industry & Commerce and its members are ready to support the process of building this future framework.

Dr Ulrich Hoppe,

Director General, German-British Chamber of Industry & Commerce

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