German economy panic as Brexit slaps industry with crippling costs – supply chain squeezed

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According to the German-British Chamber of Commerce and Industry, Brexit will have a profound impact on the German economy. Ulrich Hoppe, head of the German-British Chamber of Commerce and Industry in London, told the German press agency DPA: “It is unclear when supply chains will operate as smoothly as before December 31, 2020, again.

“That is why many companies have invested in longer-term storage capacity, among other things.”

Mr Hoppe said the economy was, nonetheless, adapting to the new challenges.

He added: “But it will take longer than originally expected for the systems to run smoothly.”

He praised the fact that the Brexit trade agreement between the UK and the EU had “provided a certain amount of security”.

He said: “Had such an agreement not been concluded, there would have been more massive upheavals, not just in commercial transactions.”

The UK had also left the EU customs union and the internal market on January 1.

Since then there have been delivery problems because of new regulations and formalities.

In some industries, there are new tariffs despite the agreement.

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Above all, the automotive industry, which is dependent on international supply and value chains, but also the food industry with perishable goods and hygiene regulations are severely affected by Brexit, as Mr Hoppe said.

He continued: “The new visa regulations also lead to considerable additional work for all companies that send international employees or are dependent on international talent.”

The UK and the EU have been locking horns over a diplomatic spat on the implementation of the Northern Ireland Protocol, included in the Brexit agreement.

The UK has applied for an extension to a grace period allowing chilled meats to continue being shipped from Great Britain to Northern Ireland after the end of this month, when the current arrangements are due to expire.

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Irish premier Micheal Martin said he has no doubt over the EU’s willingness to “reach an accommodation” over the Protocol.

However, he said the UK must be willing to engage in the process and follow through on commitments already made.

Speaking from the European Council summit in Brussels on Friday, he said: “A deal can be reached.

“It will take political will and commitment.

“I’m in absolutely no doubt about the commitment of the European Union as an institution, but also the members and the key members of the European Union, and their desire to reach an accommodation here in relation to the implementation of the Withdrawal Agreement and the Protocol.

“There is a willingness to be pragmatic and flexible on this but the United Kingdom Government has to engage in the process.

“My last meeting with Boris Johnson, he was clear he would give this a very strong shot at trying to reach an agreement.

“I’m in no doubt the willingness is there on the EU side. The EU does need reciprocity, it needs the sense from the UK that it will follow through on its commitments that it’s signed up to, and that it will deliver on those commitments.”

Additional reporting by Monika Pallenberg

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