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Consequences of a No-Deal: Panic before the Chaos Brexit - Do you really have to shiver?


TIME ONLINE | News, backgrounds and debates

Brussels (AP) - Downing Street is more than 300 miles away, but when a new Brexit wave rolls in London, it spills right over Martina's desk.

Of course this is not meant literally, the 24-year-old sits dry and sheltered in a sunny open-plan office on the Avenue de Cortenbergh in Brussels. But she knows: "What's going on in the news, it does trigger something here. People call. »

Will I still be able to travel without a visa after a Brexit? Can I take dog or cat with me? What will become of my Erasmus scholarship? Will I be deported? Martina hears all these questions from her leadership at Europe Direct, the EU telephone number box, where anyone can call toll free. After this week, with the confused power struggle in London and the enormous uncertainty, the phones are likely to ring the storm again.

"With a view to a possible Brexit without a contract, people panic, and that's understandable," says Martina, who specializes in Brexit issues in the call center and would like to know just called her first name. "We want to help people to stay calm."

Panic? Is that appropriate? Do you really have to tremble in Germany before the plans of the gentlemen on Downing Street? Or is it time to put a stop to the drama? This can be found, for example, by the renowned expert Marcel Fratzscher from the German Institute for Economic Research.


The fact is: Brexit is announced for the 31st of October, but still no exit agreement is ratified. Even after the vote of the British House of Commons against the no-deal and despite the possible prospect of new elections in the UK: The danger that the country in eight weeks without an agreement "over the cliff" crashes, is not banished.

Without a contract, that is, there is no transitional period and no legal certainty. From one day to the other, everything is different between the EU and the UK - new rules, new regulations, new controls at the borders. In the official language of the European Commission, it sounds like this: "Of course, this would cause considerable disruption for citizens and businesses and have serious negative economic effects, which would be much stronger in the UK than in the EU-27 Member States."

Hundreds of pages have been written about what that will mean. In the short term, waiting hours for lorries at the border are expected for hours or even days in the event of a chaos-Brexit. The British government fears supply shortages of food and medicines. Many British have long begun to hoard supplies.

In the medium term, studies predict a slump or even a recession. Export losses, currency collapse, factory closures, unemployment. In the case of a no-deal brexit, experts from the Bertelsmann Foundation came to an income loss of nearly € 100 billion per year - of which € 57 billion was for the United Kingdom alone.


According to this calculation, Germany would have losses of more than 9.5 billion euros per year. According to calculations, 115 per year are missing in the household budget per capita. For a family of four that could be a short break in the Allgäu or on the Baltic Sea.

Well, you just drive away less, the world is not going down - you could say. But for one, these are just statistics and arithmetic variables. The already sluggish economy in Germany could be a no-deal hit a decisive blow. In addition, individual regions such as North Rhine-Westphalia are hit particularly hard with high exports to Great Britain, says study author Dominic Ponattu. Even individual industries suffer massively. The expert names the auto industry, the pharmaceutical industry, chemical companies, food exporters.

Vegetable farmers fear that they no longer need to bring tomatoes or peppers fresh on the island and strike at dumping prices on the continent. German candy manufacturers say, after a tough Brexit British competitors could buy sugar cheaper on the world market and flood the German market with cheap goods. And so on.


Many have tried to arm themselves for day X. The EU Commission has published dozens of handouts, but this week again a checklist of rules, clues, innovations. However, some things can hardly be regulated without collusion with the British, such as the fishing rights for European fishermen.

That makes Uwe Richter very worried. "Our catch at North Sea herring comes to 100 percent from the British zone," says the managing director of Dogger Bank Seefischerei GmbH in Bremerhaven. "We will not be able to fish in British waters from 1 November." Without an agreement with London, German fishing vessels might have to be taken out of service at times or completely.

On land, the misery continues. Richter also heads the fish factory Euro Baltic in Saßnitz-Mukran on Rügen. "We rely 100 percent on herring from the British zone. This calls into question the existence of the work. »250 jobs at Euro Baltic were in danger and other jobs at cooperating companies.

It has long been clear that Brexit will cost jobs. The dimension sheds light on a study by the Belgian University of Leuven. Thus, in a no-deal would be 1.2 million jobs in the EU of the 27 in danger and another 525,000 in the UK. For such economic and prosperity risks, Bertelsmann researcher Ponattu is clear: "It's still good for all sides if Hard Brexit is averted. More time to negotiate an agreement would definitely be worth it. "


But that's not all where everyone agrees. DIW President Fratzscher said in the spring that the negative consequences of a no-deal Brexit would be overestimated. "Most people in Germany will hardly feel a hard Brexit themselves," he said then.

Now Fratzscher told the German press agency: "Better an end with horror than a horror without end - rather now a hard Brexit than a hangover, which will drag on for another year or two." The most important thing is planning security, then companies could have the consequences mastering a no-deal too. Many have started to reorient themselves. German exports to Great Britain have already fallen by 11.4 percent in 2018, imports by as much as 15.4 percent.

Chaos on the borders on November 1st? That does not have to be, if both sides control and customs to the bare minimum, says Fratzscher. The EU also has an interest in liquid processes. It is nonsensical for Great Britain to make life difficult because of the resignation, says the expert, because it is obvious that the country is the biggest loser of Brexit. "I do not think any other country wants to have as much chaos as Britain has seen in the past three years."

Information about Europe Direct

Short version of the Bertelsmann study

Study by the University of Leuven on Brexit consequences

Latest report on EU preparatory actions of 4.9.2019

Source: zeit

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