German firms should prepare for a no-deal Brexit, the head of the BDI Federation of Industry has warned. "A hard Brexit would be disastrous," he said as the UK prime minister fights for approval of her exit deal.
The automotive, aerospace, chemical, pharmaceutical, engineering and electrical industries would be hit the hardest by a no-deal Brexit, Dieter Kempf told Funke Mediengruppe on Saturday. Service industries such as banking and tourism would also be affected, he said.
The consequences of a no-deal, hard Brexit would be felt by companies and workers in Britain and across Europe, Kempf added.
UK Prime Minister Theresa May has repeated her mantra that there is no alternative to her Brexit plan. Writing in The Sun newspaper on Sunday, May said there was no other approach that the UK could agree with the EU.
May faces opposition to her plan from within her own Cabinet and in Parliament, where by current estimates she would be several votes short of the number necessary when the assembly comes to vote on the exit deal in December. May may also face a challenge to her leadership in a no-confidence vote being prepared by hard-line Brexiteers in her own party.
However, some Conservative lawmakers who campaigned against Brexit have warned their party hard-liners they would act to prevent a no-deal Brexit. "Be very clear," wrote Alistair Burt, a minister at the foreign office. "If an agreed deal on leaving between the Govt and the EU is voted down by purist Brexiteers, do not be surprised if consensus on accepting the result of the Referendum by Remain voting MPs breaks down. Parliament will not support no deal."
For its part, Brussels has indicated there is no room to change the terms of the deal for the UK's exit. The 27 EU leaders are due to meet next Sunday to discuss the terms of the deal.
With just months to go before Britain leaves the EU in March, preparations need to be made for new computer systems and projects to be ready in case no deal is reached with the EU. They would need to cover border crossing for people, goods and services on March 29 as all EU rules and regulations instantly cease to apply to the UK.
With no deal, there would be no agreements between Britain and the EU on how to manage customs, trade, travel or citizens' rights. UK exports would face the same customs checks and tariffs as other countries outside of the EU. Some government research suggests Britain would run out of some food and medicines within a fortnight.
Preparing for no deal
The government has contingency planning underway, including provisions for the stockpiling of food and medicines and turning parts of the A20 motorway by the southern port of Dover into a permanent lorry park.
The rights of 3 million EU citizens living in the UK and more than a million UK citizens living in the EU would not be protected under a no-deal scenario. An anomalous situation for each individual would depend on each individual EU state. Ireland may come under pressure to exert customs and immigration controls at the EU-UK land border with Northern Ireland.
Appeal to responsibility
"A hard Brexit would be disastrous," the BDI's Kempf said. "It would cause great difficulty for tens of thousands of companies and hundreds of thousands of workers on both sides of the English Channel."
Kempf said he only saw further uncertainty: "I appeal to the lawmakers in the British Parliament to be conscious of their responsibility," he said. "The ball is in London's court ... New negotiations are not the answer."
jm/bw (Reuters, dpa)