Beware: Stricter Border Controls Might Hurt the Economy, Warns German Business
Trade organizations caution about potential drawbacks of tightened border regulations for commerce - Trade organizations issue alerts on potential harm from tighter customs regulations
Hey there! Let's talk about a hot topic that's been causing a stir recently: stricter border controls for trade. The head honcho at the German Chamber of Industry and Commerce, Volker Treier, is sounding the alarm.
According to Treier, even during the pandemic's rough times, we've seen that stricter border traffic can put a strain on the economy. It's crucial for politicians to remember this when aiming to curb irregular migration. To keep things flowing as smoothly as possible, we need a functional European internal market and the Schengen area, essential for our internationally connected German economy.
Treier also pointed out another issue: higher storage costs for companies. Just-in-time deliveries, which are common in today's fast-paced business world, would become much harder with stricter controls. In tough economic times, that's an extra burden no one wants.
But it's not just the big companies that might get hit. Treier is concerned about greater restrictions for cross-border commuters and service providers. Industries like regional retail, border gastronomy, and care and health sectors heavily rely on free movement of goods and people.
The DIHK's president, Dirk Jandura, said that, if necessary, controls should be temporary. However, he and the DIHK experts are hoping for close cooperation with the Interior and Transport Ministries to prevent major problems. They suggest creating "Green Lanes," speedy paths for goods traffic, to minimize delays at borders.
Politicians like Dobrindt are pushing for tougher border controls. They want to see lower numbers in irregular migration, but they also stress that these controls will be temporary. The Chancellor's Office chief, Thorsten Frei, said they don't intend to restrict freedom of movement in the EU or permanently abolish the Schengen Agreement.
So, what's the worry? Well, stricter border controls could mean increased costs, supply chain disruptions, reduced competitiveness, increased geopolitical risks, potential retaliation, and decreased flexibility and innovation, which can add up to a significant economic downside for Germany's trade-dependent economy [4].
[4] Enrichment Data: The German Chamber of Industry and Commerce (DIHK) highlights several potential economic disadvantages of stricter border controls for trade, including increased costs, supply chain inefficiencies, reduced competitiveness, increased geopolitical risks, potential retaliation, and decreased flexibility and innovation.
- The German Chamber of Industry and Commerce, led by Volker Treier, fears that stricter border controls could result in increased costs for companies due to higher storage costs for goods.
- In addition to rising costs, Treier warns that stricter controls could lead to supply chain disruptions and reduced competitiveness, especially for industries like regional retail, border gastronomy, and care and health sectors.
- Dirk Jandura, the DIHK's president, suggests creating "Green Lanes" for goods traffic to minimize delays at borders and prevent major problems.
- There is a concern that stricter border controls could lead to decreased flexibility and innovation in Germany's trade-dependent economy.
- Politicians like Dobrindt advocate for temporary border controls to curb irregular migration, but they stress that these measures are not intended to restrict freedom of movement in the EU or permanently abolish the Schengen Agreement.
- The German economy, particularly EC countries, could face potential retaliation and increased geopolitical risks due to stricter border controls for trade.
