The German ambassador to the UK says they will be advocating the economic relationship between the EU and Britain to be “as close as possible” in any future trade deal.
Dr Peter Wittig was visiting the Innogy Maintenance and Operation Centre, in the Port of Mostyn, Flintshire.
He spoke about the relationship between Wales and Germany - both in terms of exports, tourism and investment by German companies in the nation.
But he did warn that Wales’s powerful manufacturing sector could be impacted by the end of frictionless trade as it relied on “just in time” supply chain.
Speaking to Business Live, he said: “We (Wales and Germany)have surprisingly strong links, 20% of Welsh exports have their destination in Germany and we export to Wales about £3.2bn a year.
“We have 80 major blue chip German companies here like Siemens, but also lots of SMEs.
“Tourism is also a big issue, close to 90,000 German tourists come over every year, it is very popular.”
Speaking about the future, he said: “The decisive question is how can we forge a new relationship in the future and we are just embarking on that next chapter.
"The negotiations between the EU and UK will start at the beginning of March and we have quite an ambitious time limit as the prime minister has said he will never ever prolong this transition period so there is a fixed time limit to the end of the year.
“That limits, from our point of view, the EU point of view, the level of ambition. Trade deals are complicated issues.
“In this case we are helped by the fact we come from full convergence of rules, regulations and standards because we were all part of the EU.
“The question the UK Government has to decide is how much divergence and how much alignment.
“The more divergence in rules and regulations and standards the less access to the European market the UK will get.”
On Wales he said: “It will be a decisive moment for the Welsh economy, in particular the manufacturing industry.
“The Welsh manufacturing industry is about 20% of the Welsh economy which is double the percentage of UK wide manufacturing which is 10%.
“So Wales depends more on the manufacturing sector and manufacturing is dependent on ‘just in time’ integrated supply chains, and manufacturing loves frictionless trade, no customs or regulatory checks at the borders, no tariffs.
“That is the big issue, we will not have an entirely frictionless trade because the Uk has decided not to be part of the single market and not part of the customs union.
“There can still be a recognition of the level playing field, basically convergence on rules, regulations and standards.
If there is an understanding that we are still operating in a joint framework of rules and regulations then the friction can be minimised.”
He added: “The UK is not only an important political partner but an important economic partner, it’s the fifth largest economy in the world, we have strong trading relationships with the whole of the UK and in particular Wales. Access is important so we work and be advocating for as close as possible economic relationship that we can build up.”
