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"Can almost treat Bavaria as a separate country" - an interview with Johnson's Secretary of Commerce Greg Hands

2021-05-15T15:49:39.242Z


Bavaria's trade volume with Great Britain fell by 18 percent in 2020 compared to 2019. An interview with the UK Secretary of Commerce.


Bavaria's trade volume with Great Britain fell by 18 percent in 2020 compared to 2019.

An interview with the UK Secretary of Commerce.

Munich - In the 2016 Brexit vote, Conservative MP Greg Hands voted for Great Britain to remain in the EU.

Things turned out differently: Great Britain has not been part of the European internal market and the customs union since January, now Greg Hands, as Minister of Commerce under Prime Minister Boris Johnson *, has the task of reorganizing economic relations worldwide.

Time is of the essence: In the first quarter after Brexit, the UK's economic output plummeted by 1.5 percent compared to the previous quarter, as the authorities announced on Wednesday (see chart). And a look at the Bavarian foreign trade statistics shows that exports to the island have been declining since 2016. In the Corona year 2020, exports even collapsed by 18 percent compared to the previous year. After Brexit, things continued to decline in January, with Bavarian exports minus 33 percent compared to the previous year. The numbers stabilized somewhat in February, but remained deep red at minus 13 percent. On the occasion of his visit to Munich this week, we discussed with Greg Hands the question of how he envisions the future of Bavarian-British delivery traffic in view of the upheavals.

One has the impression that trade relations between Bavaria and Great Britain have reached a low point.

As Minister of Commerce, have you come to terms with the fact that the movement of goods between Bavaria and Great Britain will not return to the previous level for a very long time?

It is too early to make such an assessment.

So far the data shows that while UK trade with both the EU and Germany declined in January, we saw some recovery in February.

The companies have apparently got used to the new arrangements.

It should also not be forgotten that the Corona situation in Great Britain was very serious in January and France had closed the borders, so that the movement of goods between Calais and Dover temporarily came to a standstill.

But the truth is also: Despite the recovery in the months after January, the trading volume is still well below the values ​​of previous years.

Is this now the new normal that we have to come to terms with?

That's exactly what we don't know yet.

Especially since it is unclear how much of the loss in the past year was due to the pandemic and what consequences Brexit had, we still lack the data.

During my visit to Munich, however, I met with Minister for Economic Affairs Aiwanger, and the good news is that he, too, currently sees no major problems in delivery traffic between Bavaria and Great Britain.

Companies seem to be getting along very well with the EU-UK trade deal, although I admit that there are still some problems in practice.

Which are they?

Of course, dealing with new agricultural forms or customs forms is not easy, that is clear.

And many companies have questions about new VAT regulations that are in place now, and so on and so on.

But we are trying to help the companies as best we can in this situation.

+

UK Trade Secretary Greg Hands

© UK Parliament

In addition, there are uncertainties for companies: Northern Ireland has remained in the European single market, but this is not exactly popular in London.

If the dispute escalates, the EU could react with punitive tariffs.

Can you guarantee that it won't come to that?

I don't see this risk, I disagree.

It is correct that there were uncertainties before the negotiations in 2016 and 2020.

But thanks to the exit agreement and thanks to the new trade agreement between the EU and Great Britain, all uncertainties are no longer there.

Companies can now plan reliably and are getting used to the new reality.

Incidentally, we get this feedback from all European governments.

But surely the complicated Northern Ireland question could lead to new uncertainties?

Northern Ireland is of course very important and an integral part of the UK, even if the customs and trade regulations are different there.

But that will not create uncertainty or instability in the situation.

Nevertheless, a dispute between France and Great Britain over the Channel Island of Jersey escalated in early May. Many French fishermen wanted to continue fishing in the waters off Jersey, but were not allowed. The EU has identified a clear breach of the trade agreement. Doesn't this dispute prove that, despite an agreement, instability can arise very quickly at any time?

Jersey has the right to self-determination over fishing and the Jersey authorities take a different view of this from the EU.

The trade agreement defines a transition phase until the end of April, and Jersey introduced new fishing rules at the beginning of May.

These are undoubtedly important questions that were last discussed here.

However, these questions do not lead to more uncertainty and therefore also have no influence on trade relations between the United Kingdom and the EU, Germany or Bavaria.

What consequences would a secession of Scotland have on British foreign trade?

I don't think Scotland will split off.

One must not forget: my party, the Conservative Party, was very successful in the elections, we won seats.

But of course it is also correct that the SNP won the elections and will now form a new government.

(Editor's note: The Scottish National Party SNP advocates independence for Scotland.)

The SNP could find a majority for an independence referendum.

But if you add up the votes for Conservatives, Labor and Liberals, you see that over 50 percent of voters voted for Scotland to remain in Great Britain last week.

A possible independence referendum should therefore not be a priority now.

Much more important is that the governments of Great Britain and Scotland successfully fight the pandemic, that is our main task.

We are clearly against a referendum, which is why it is much more important to intensify cooperation with Scotland in the years to come.

Do you still have a plan in the drawer at the Department of Commerce that shows the effects a secession of Scotland would have on trade and the economy?

No, we have not worked out such a scenario because, as I just said, this topic is currently not a priority for us.

What does this mixture of Brexit and the political debates about Northern Ireland and Scotland mean for Great Britain as an investment location?

Do you see the danger that foreign companies will leave the island and prefer to plan their branches and production facilities on the European continent?

I can not imagine that.

We saw very little relocation even before Brexit and we also saw many companies even opening new offices in the UK.

I am also particularly pleased that Bavaria will now open its own office in London.

I don't know whether they would have done that without Brexit, but the planned Bavarian office proves that we are still very attractive as an investment location.

How important is Bavaria as a trading partner for Great Britain?

Goods worth 15 billion euros are traded between Great Britain and Bavaria every year - that's about as much as we trade with Canada.

As far as economic relations are concerned, we can therefore almost see Bavaria as a separate country.

You visited Munich this week.

What perspective did you bring with you to your Bavarian interlocutors?

Which companies are you in contact with?

In addition to discussions with Economics Minister Aiwanger, the meetings with BMW * and Audi as well as the Association of Bavarian Business vbw were particularly important to me.

My message is very clear: Great Britain remains open to business and open to Bavarian companies.

Was your visit more about promoting the investment location or more about getting trade going again?

Actually both.

For example, we're still very happy that BMW is producing its electric Mini in the UK.

The decision to make this British icon in Oxford is very important to us.

But it is just as important to us that the supply chains for auto parts continue to function smoothly - we talked about that too.

Despite the Brexit, you seem very hopeful about the future.

Look: Britain left the EU, but we didn't leave Europe.

My wife is German, my children grew up bilingual, and I live in a German-British world every day.

For that reason alone, I am optimistic that we will be able to further deepen relations between the two countries.

Brexit will not change that.

Read more about Brexit here. * Merkur.de is an offer from IPPEN.MEDIA.

Source: merkur

All news articles on 2021-05-15

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