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Most German firms uncertain of effect of possible Brexit - survey

Published 08/06/2016, 14:02
Updated 08/06/2016, 14:10
© Reuters.  Most German firms uncertain of effect of possible Brexit - survey

BERLIN (Reuters) - Almost two-thirds of German companies are uncertain what the effect of Britain leaving the European Union would be on their business, a survey showed on Wednesday, with the referendum on membership just two weeks away.

The poll, by the BDI industry association and Deloitte, showed that 64 percent of firms were not able to assess the effect of Britain - Germany's fifth biggest trading partner - quitting the bloc and 30 percent thought it would be negative.

"Uncertainty among German companies about future business relationships with the United Kingdom is tangible," BDI Managing Director, Markus Kerber, said.

More than half of the 215 companies surveyed export to Britain or have a subsidiary there and the others are dependent on imports from Britain or its manufacturing facilities.

More than two-thirds expect Brexit to increase financial market uncertainty and 60 percent foresee higher capital market and exchange rate volatility in such a scenario until relations between Britain and the EU are reorganised.

Polls in Britain suggest it is a close race between the "Remain" and "Leave" camps.

The survey showed that 46 percent of firms think direct investment would be diverted to continental Europe from Britain should the "Leave" camp win and 43 percent expect customs duties to rise for German exporters.

Deloitte chief economist, Alexander Boersch, said almost half of the firms surveyed were concerned about Brexit increasing complexity and pushing up costs but only 29 percent of companies had so far made preparations for this and those were mainly firms in the financial sector.

The survey was carried out between May 17 and 19.

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