Germany's Mittelstand wants to avoid hard Brexit for fear it will harm the EU and Britain

Rebecca Smith
Theresa May has said she won't seek membership of the Single Market in Brexit talks
Theresa May has said she won't seek membership of the Single Market in Brexit talks (Source: Getty)

Germany's Mittelstand, the so-called "backbone" of the nation's small and medium-sized firms, are keen to avoid a hard Brexit, they have said.

The president of the BVMW, which represents more than 270,000 businesses in Germany, has said denying access to the Single Market for the UK "would harm both sides", with German small and mid-sized firms could losing "billions".

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Speaking to the BBC, Mario Ohoven said: "Germany exported goods worth €89bn to the UK alone in 2015, almost half of it was exported by 150,000 SMEs."

He added that many more traded indirectly with the British market and looked to the UK for research and development too.

"We shouldn't forget that 750,000 jobs in Germany depend on the trade with the United Kingdom," Ohoven said, and rebuffed the idea that a hard Brexit was appealing for some, as it could mean less international competition with Britain out the Single Market.

"The German Mittelstand does not believe in the world economy as a fixed-sized cake, in which every country has to fight against the other countries to increase its share," he said.

"A hard Brexit, or an increase in protectionism, will only lead to a decrease of the cake as a whole. I want to be very clear here - Brexit knows no winners, all sides will lose."

It marks a different approach to that taken by German politicians, who have mostly been clear that the UK cannot have unrestricted access to the Single Market unless it also accepts free movement of EU citizens.

Theresa May also said in her letter to the European Union that the UK will not seek membership of the Single Market in Brexit talks.

"In the end, a soft Brexit should be reached. It is important that the UK stays in the Single Market, or that the UK joins an agreement similar to the EFTA (European Free Trade Association), similar to Norway or Iceland. The worst result would be if the EU and the UK did not reach an agreement in time," Ohoven said.

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The Prime Minister said earlier this week the UK will know its "future relationship" with the EU before the Article 50 talks draw to a close.

Questions have been raised over whether the government will be able to close talks on both trade and divorce terms within the time frame permitted by Article 50, but Theresa May has been confident this is achievable.

“I'm clear: by the point at which we leave the EU it's right that everyone should know what the future arrangement, relationship, partnership between us and the EU will be," May said on Tuesday.

"That's the sensible thing. It's a pragmatic way to look at it.”

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