© Skypixel Dreamstime.com Analysis | June 21, 2016
Brexit would weaken European Union as industry location
The mechanical engineers in Germany fear negative consequences if Great Britain should leave the European Union.
German industry association VDMA warns that the so-called Brexit (United Kingdom European Union membership referendum) would worsen the investment climate in Europe. If the country, on June 23, 2016, does vote in favour of an exit from the European Union, trade with UK countries would be noticeably more difficult. In the first quarter 2016, machinery exports from Germany to the UK declined with four percent YoY to around EUR 1.7 billion. With an export volume of EUR 7.2 billion per year (2015), the UK is the fourth most important market for equipment manufacturers. "A Brexit would be a setback for Europe's industrial base. It would follow by a long period of uncertainty, poison to the already clouded investment climate in the EU. Europe has to reassure, rather quickly, that this does not necessarily spell the end of the EU", says VDMA chief executive Thilo Brodtmann. The German equipment manufacturers are particularly dependent on exports and achieved around 77 percent of their sales abroad (2015). When it comes to main export markets, Great Britain ranks - behind the United States (EUR 16.8 billion), China (16 billion euros) and France (EUR 9.8 billion) - 4th place. The country is followed by Italy (EUR 6.5 billion) and the Netherlands (EUR 6.1 billion) in 5th and 6th place respectively. At the same time was Germany (in 2015) the most important equipment supplier for the UK; ahead of the US and well ahead of China.