Are businesses leaving the UK to come to Germany?
Todd: Not typically, no. They are keeping one foot planted firmly in the UK and expanding to the German market. Beyond concerns over Brexit, German stability and market size are other key factors. Consumer demand in Germany has been high in recent years, the economy has been resilient throughout the COVID-19 crisis, and we are hoping to bounce back as quickly as possible.
What are British companies thinking at the moment about the global pandemic and Brexit?
Todd: Well, there are a few different answers to that question. Obviously thousands of companies are focussed on dealing with the effects of COVID-19 right now. Priority number one is simply to survive. This is especially true for the retail and hospitality industry. And lurking around the corner is the end of the Brexit transition period at the end of 2020, so companies are waiting to see how their business on the Continent will be affected and preparing for all possible scenarios.
What are companies doing to prepare?
Todd: Smart companies are checking their contracts, adjusting their supply chains and assessing risks to their business model as best they can. Waiting and hoping for the best is certainly not a strategy we would recommend. What is most interesting for us is the growing number of companies setting up in Germany as a hedge against risk.
What are the repercussions for the German-British economic relationship?
Todd: The terms of any future UK-EU free trade agreement are vitally important to both economies and still very much uncertain. It would be naïve to think that new trading barriers would not have any economic impact.
That said, some bilateral relationships are growing stronger. To give an example, experts at GTAI and the UK’s Department for International Trade are dovetailing various efforts to create a favourable business climate for companies from both countries.
If you had a crystal ball, where would you see the economic relationship in five years?
Todd: We believe that UK and German businesses will learn to adapt to any new rules that will be introduced. Germany and the UK have such strong ties that we will remain important trade and investment partners in any scenario. Where there is a will, there is a way.