German businesses warn against ‘Dexit’ amid fears of far-right gains

Germany’s exit from the European Union, also known as “Dexit”, would cost the country’s economy €200 billion a year, business lobby INSM warned on Wednesday (5 June), as Germany’s far-right AfD party, currently second in the polls ahead of this weekend’s EU elections, maintains a strong anti-EU rhetoric.

Germany has benefited more from EU membership than any other large EU country, such as France, Italy, or Spain, according to a study presented by INSM, a lobby group funded by German employers’ associations in the metal and electronics sectors.

Four days before Germans vote for their representatives in the next European Parliament on Sunday, the group has stepped up its warnings about the risk of the bloc’s biggest economy leaving the EU, as advocated by the far-right AfD party.

While some parties would advocate leaving the EU, “namely the AfD”, Thorsten Alsleben, director of INSM, said on Wednesday that “we have to counter that”.

“When you talk to people about Europe, which we do regularly, you often hear this argument that it’s so annoying, and all these regulations and the long decision-making processes,” Alsleben added.

“But it’s like in a marriage: You shouldn’t just look at the bad things, the toothpaste tube or the open cupboard door. You have to look at what’s good,” he added.

A referendum on EU membership was proposed by AfD leader Alice Weidel in an interview with the Financial Times earlier this year when she described the UK’s 2016 Brexit vote as a “model for Germany”.

The AfD, which was recently kicked out of far-right ID group in the European Parliament, is currently polling second in the European elections with around 15%, neck and neck with the German SPD (S&D) of Chancellor Olaf Scholz, as well as the Greens.

In its election manifesto, the party describes the EU as “unreformable” and “failed” and calls for its replacement by a newly created “Confederation of European Nations.”

According to a study by economists Gabriel Felbermayr and Inga Heiland, a breakup of the EU would cost the German economy around €200 billion a year in real income — a loss of almost €2,500 per capita.

The authors note that, by contrast, the annual net contribution of German taxpayers to the EU budget would be less than a tenth of that.

“[Some] people act as if the EU is insanely expensive,” Felbermayr said in Berlin, calling it a “strange discussion”.

Although the AfD is unlikely to become part of the German government any time soon – as all other parties have ruled out the possibility of forming a coalition with it – its prospect of scoring some electoral victories, particularly in the east of the country, has worried companies that benefit from exports and fear that rising xenophobia could hamper their access to international talent.

“Exclusion, extremism, and populism pose threats to Germany as a business location and to our prosperity,” an alliance of 30 well-known German companies warned in May, including carmaker BMW, chemical giant BASF, and lender Deutsche Bank.

EU membership is broadly popular in Germany, with only 10% in favour of a so-called Dexit, something that has led the AfD to tone down its rhetoric in recent months and instead focus on more specific policy issues, such as EU climate policy.

(Jonathan Packroff | Euractiv.de)

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