"Better than no agreement": German economy facilitates through deal

Friday 25th December 2020

"Better than no agreement"
German economy relieved over deal

A few days before the deadline, the UK and the EU agree on a trade pact for the post-Brexit period. The agreement is a sigh of relief within German business. Only the German fishing association speaks of a "black day".

The German economy reacted with relief to the agreement between Brussels and London on a trade agreement for the period after Brexit. "The agreement is better than no agreement," said the general manager of the Federation of German Industries (BDI), Joachim Lang.

However, the agreement means "additional bureaucracy and unnecessary border formalities" for most companies. "Nothing is dry yet," warned Lang. He urged the parliaments and governments of the EU to "act prudently and at the same time swiftly".

The president of the foreign trade association BGA, Anton Börner, described the agreement as "the best of all bad solutions". "Therefore, despite the relief, there is nothing to celebrate," he emphasized. The agreement will "greatly change our future cooperation". "It remains to be seen whether it will also help to alleviate the feared chaos at the turn of the year."

The President of the Association of the Automotive Industry (VDA), Hildegard Müller, is also relieved that the agreement has come about. "With the result that has become known, the risk of a 'no deal' has been eliminated and companies can finally prepare for the implementation of a free trade agreement," explained Müller. The trade agreement is "the best scenario now achievable".

According to the EU Parliament's Brexit Commissioner, David McAllister, trade will "no longer run as smoothly" as before. Companies and authorities would have to prepare for more bureaucracy in the movement of goods, said the CDU politician of the newspaper "Die Welt".

"The British fishermen are the clear winners"

Sharp criticism of the agreement came from the President of the German Fisheries Association, Gero Hocker. "December 24th, 2020 will go down in history as a black day for European fisheries, fishermen and their families as well as the coastal regions in Europe and Germany," he explained.

"The German companies are losing a historically grown status quo in the distribution of fishing rights, while the British fishermen are the clear winners of the negotiations," said Hocker. The result was also a "failure for the federal government, which was unable to protect German companies from the effects of Brexit".

On Christmas Eve, Brussels and London agreed on a trade agreement for the time after Brexit and thus likely averted a severe economic break between Great Britain and the EU at the end of the year. The approval of the 27 EU governments and the British Parliament is still pending. After the UK leaves the EU internal market at the end of the year, the agreement provides for trading without tariffs and without quantitative restrictions.

The negotiators also agreed on the central issue of fishing. The agreement provides for a transition period of five and a half years for the reduction of the fishing quotas for EU fishermen. According to EU representatives, a 25 percent reduction in catches was agreed with Great Britain during this period. From June 2026, the catch quotas should be negotiated again annually.