Brexit All article To Person Institute of the German economy Cologne Michael Hüther , Born 1962, is since 2004 the Director of the Institute of the German economy in Cologne (IW Köln). After his studies of Economics and of the Middle and Newer history, he was the first Secretary-General of the Council of experts for the assessment of overall economic development (“Five”), and chief economist of DekaBank.
MIRROR ONLINE: of The Brexit Deal from Theresa May has failed in the British Parliament. What should the German economy now?
Hüther: I can only guess the company just Sets you on a hard Brexit, the contingency plans! There is in British politics Yes no majority for a certain Option but only negative majorities against the negotiated Deal, against a EU-exit without a Deal, against a second Referendum. Also, the Europeans have made it clear that there’s no more to negotiate much.
MIRROR ONLINE : you are significantly more pessimistic than many other German Economists, who point out that the British Parliament would like to prevent a hard Brexit in any case.
Hüther: The history shows that often things have happened, even though nobody wanted them. I feel the book “The sleepwalkers” by Christopher Clarke recalls, describes how the European powers reeled in the First world war. What should the EU do? With May now for many weeks to negotiate, although the British Parliament is completely unpredictable? Even if it was a change of government: the Labour party and her boss Jeremy Corbyn don’t know what you want. Whether it comes now at the end of still as by a miracle to a Deal or not: As an entrepreneur, you need to pull the emergency plans.
MIRROR ONLINE: Clemens Fuest, head of the Ifo Institute, calls vehemently for new negotiations, because a hard Brexit should be avoided at all costs. And Ifo Economist Gabriel Felbermayr appeals even to the EU, to break the principle of the four freedoms of the internal market – specifically, the free movement of persons.
Hüther: , If at all, should have already happened in the two-year long negotiation phase, but not in this situation. In the Brexit debate, you do not need to argue as a political Economist, economic wishful thinking. And: The States of the EU have given themselves these four freedoms – the movement of Goods, services, capital and people – aware, due to the historical experience. Now in a night and fog action to just give up, goes to the foundations of the European Integration. In the Rest: What’s that supposed to be now negotiated? The EU as a Whole would have to revise their Position for the past two years. A gain in credibility would not be the. We just have to accept at some point: If the British want to leave, you want to escape.
MIRROR ONLINE: Which is the damage of the German economy through a hard Brexit?
Hüther: , It contributes to the already projected cooling of the economy, but also caused by the protectionism of Donald Trump, the trade disputes and the economic weakness of China, – these things are important. How it will affect individual companies depends on the industry. The car industry is affected heavily by the customs duties and the threat of delays in delivery caused by border controls. You will be able to handle it. More difficult in the chemical industry: product certifications according to the EU chemicals regulation for the Import into the EU could be from one day to the other invalid. If a German company now has a factory in the UK, their products are processed in the EU, he has a big Problem.
MIRROR ONLINE: How are the German companies, on a hard Brexit?
Hüther: All of the large companies have chains for your delivery and therefore also for small and medium-sized suppliers – defined emergency plans, anything else would be negligent. This also applies to the banks. However, they have not made these plans for good reasons in the past. It is, therefore, unclear how the companies will interact in the Individual.
MIRROR ONLINE: According to the survey, your Institute even many companies that export to the UK but have not yet.
Hüther: Who exported exclusively to the United Kingdom, has manageable problems. Then only the prices that have to pay the British to increase tariffs in the rule. 60 percent of German exporters expect only three per cent is not to be feared, with significant effects noticeable incisions.
MIRROR ONLINE: we Understand you correctly? A hard Brexit would be very regrettable, at least economically, but actually only for the British a big Problem?
Hüther: , of Course, a hard Brexit will have consequences for the location of the UK and for British jobs. But to be honest, this is not the biggest Problem of the British. The fact, is to heal the split in the society somehow. The one half is to blame the other half, to have her this crap into this. And the leadership figures of these other half – Boris Johnson, Nigel Farage – don’t even have a Plan for Brexit. The are now all in the bushes. My prediction is: A reconciliation of the British society in the short term is simply impossible. This complicates policy solutions. Therefore, a watch, brings, stop, or Move too little. A second Referendum would not help therefore, it appears increasingly to put naive out – of democracy for practical reasons, but especially because of the deep social cleavage.