Germany eyes firms relocating from UK

Germany has emphasised that foreign companies are welcome to relocate their regional bases from Britain to continental Europe following Britain's plans to exit the European Union.

Germany's Ambassador to Singapore, Dr Michael Witter, said talks are already taking place in London on the need for financial institutions to move parts of their business to Frankfurt, in the event that their EU passports for banking operations become invalid for Britain.

Dr Witter extended the welcome to Singapore investors to do business in Germany at a presentation on high-tech Eastern Germany held at the Raffles Hotel yesterday.

He said Britain "might try to defend primarily the City of London - this would be at the expense of industry".

Britain will most likely suffer more in terms of economic growth than the rest of the EU, he added.

"Trade with the EU, relative to all trade, is far more important to the UK than vice-versa. The rest of the EU will have economically and financially less to lose."

Dr Witter said Brexit "will not affect Germany's attractiveness". He noted that the impact of Brexit on Germany's GDP would result in growth falling by just 0.1 per cent this year and 0.3 per cent next year, compared with a Remain scenario.

Dr Jurgen Friedrich, chief executive of Germany Trade and Invest, said Brexit will affect not only Britain's economic sectors but more critically, the area of research and development.

"Germany can serve as an alternative for companies affected by Brexit. Our strengths are in biotechnology, automotive technology, energy solutions, microelectronics, logistics, automation and pharmaceuticals," he added.

Germany is one of Britain's top trading partners and a major investor with the likes of BMW, Volkswagen, Daimler, Bosch, Bayer and Siemens providing employment for half a million workers in Britain.

A version of this article appeared in the print edition of The Straits Times on July 15, 2016, with the headline 'Germany eyes firms relocating from UK'. Print Edition | Subscribe