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Brexit: The trucks go back empty

The Brexit is still being negotiated. But the economy is already anticipating many consequences.

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Brexit: The trucks go back empty

Achim Junker has already revised plans of his drivers, recalculating ir working times, calculating ir new routes. While representatives of British government in Brussels are still negotiating on how to place UK's exit from EU, freight forwarder from Blankenbach in under-Franconia already cares about facts. He's always sending fewer trucks towards island. It used to be ten 40-tonners every week, entrepreneur tells us that now only four or five are left. "Some colleagues have already withdrawn from market," says entrepreneur.

No one knows yet how Brexit will look at end of negotiations in March 2019, and yet he is long ahead of his shadow. The ideas of Theresa May are too vague to look at how Brexit and its transitional solution proposed in Florence should be. Too uncertain what kind of free trade agreement EU will ultimately be able to agree with British. The economy is responding, trade between Germany and United Kingdom is suffering. Exports from Germany to United Kingdom, which had risen significantly after 2012, have declined slightly since June 2016. At that time British voted for exit. In contrast, exports from kingdom towards Germany were particularly striking, from 1,650,000 tonnes in June 2016 to 1,480,000 in June 2017. And that, although British pound has lost much of its value at that time, that should have really inspired British exports.

In Blankenheim, Achim Junker knows exactly what this is about. The freight forwarder only needs to think about its customers. In past, his drivers drove to automobile suppliers in Aschaffenburg and Frankfurt and loaded items such as fenders or or materials. From re, trucks kutschierten semi-finished production hundreds of kilometers westward, through Belgium, through France, to England. There y delivered products at companies that manufactured from materials car seats or painted fenders. The trade was so brisk that drivers returned to Germany fully loaded again. Junkers Trucks joined in a stream of three million trucks every year, commuting back and forth between Great Britain and continental Europe to deliver goods. They are all part of tightly knit supply chains and production processes that are difficult to with, but an example of what is possible if re are no customs duties and goods can be traded freely between countries – as in internal market of EU.

But now? "The business is no longer running," says Junker. A customer, a German company, immediately moved to Brexit in United Kingdom after referendum. "He's been looking for next trade fair producers in Eastern Europe," says Junker, "so business was gone for us." The entrepreneur is observing that more and more companies are relocated in Germany without hanging big bell. The carrier sees it on websites of freight exchanges to which it can access. At present, on return journeys from Great Britain to continental Europe, 67 percent of trucks ' cargo space is empty and only 33 percent are occupied with freight, sometimes only 25 percent, he has observed. "The price of journey cannot be so good as to go back empty," says Junker.

The economy, as it is experienced by freight forwarder, anticipates Brexit. Still re are no customs duties, nor are re any trade restrictions, nor does it need any bureaucracy at border. But because German companies are expecting this, y are already looking for new customers and suppliers. Companies do not even want to risk having to shut down ir machines just because a lorry with components is stuck in customs at border.

This article comes from time No. 41/2017. Here you can read entire output.

Figures of Federal Statistical Office show Junkers Impressions: German exports to United Kingdom declined by three percent in first half of this year compared with same period last year. At same time, exports to or EU countries have risen by six percent. Trade in Europe is flourishing – business with Great Britain is stagnating.

And nothing happens, which could provide confidence. Prime Minister may did not show a clear line in her address in Florence, her cabinet is divided.

If United Kingdom leaves European Economic Area and customs union, exporters and importers must carry out extensive formalities, re will have to be border controls, trade agreements. This means additional costs and, depending on trade agreement, customs duties. A digital customs system, as British imagined for future, would be a novelty, re is nowhere in world, has never been tested. In parliamentary committees, representatives of ministries in relation to parliamentarians are very loud in saying that y have no idea how such a system should be implemented.

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