UK could ‘sleepwalk’ out of Europe – economist
BOSSES of mid-sized businesses in the North have been warned Britain risks “sleepwalking” out of Europe by a senior economist.
Dr Andreas Prothmann, head of the economic department of the German Embassy in London was addressing a conference hosted by the German British Forum at Old Trafford football stadium.
He told the gathering Britain leaving the EU could have serious consequences for investment and jobs in the North of England.
“The reaction across Europe to the terror attacks in Paris against Charlie Hebdo demonstrates that there is something to the idea of Europe,” Dr Prothmann said. “We share a belief that freedom and the rule of law are at the root of our economic prosperity.
“Unfortunately, the debate in the UK tends to focus on immigration, alongside petty regulations and red tape.
“It’s important that that companies speak out otherwise the UK risks sleepwalking out of the EU. As we saw in the Scottish referendum, the voice of business can be very important and have a decisive influence on the outcome.”
The event had a particular focus on what UK businesses could learn from the ‘Mittelstand’ – the much-heralded private, family-run companies commonly attributed with being the secret behind Germany’s economic success.
Phillip Grindley, a partner at Grant Thornton in Manchester, who worked in Germany for 14 years, said: “The Mittelstand is not a business model or a legal structure, it’s an attitude.
“The classic Mittelstand philosophy is about being privately owned and therefore able to take a long term view of everything. There is also a culture of re-investing profits and an aversion to taking up too much debt.
“The funding infrastructure is in any case different. Germany has hundreds of individual banks, where the UK now has just a half dozen lenders. The banks are more local, know the companies personally and are therefore able to assess the risk really well.
“The Mittelstand is also about having a strong sense of social responsibility. These firms are very close to their employees. The UK does have lots of privately owned businesses which have a very similar outlook – but they are much less celebrated over here, he added.
