A powerful association of German manufacturing industries, the VDMA, has called for “fair” discussions over Britain’s departure from the EU but warned there should be “no unilateral concessions” in favour of the UK, saying the EU single market was more important to them.

Thilo Brodtmann, VDMA executive director, called for Brexit negotiations to be held swiftly, saying, “We must not run the risk of having no agreement in place two years from now,” when talks come to a close.

But he said preserving the single market among the remaining 27 EU member states was more important to VDMA member companies than keeping access to the UK market.

The UK was the fourth-largest export destination for the German mechanical engineering industry, at €7.4 billion last year, VDMA said – behind the USA, China and France. Exports to other EU countries, by comparison, represented €72.5 billion, or 46% of all trade in that sector.

“One thing is clear: Ensuring the long-term survival of the European single market is more important for the industry than the short-term facilitation of trade with the UK,” Brodtmann said in a statement.

“That’s why an agreement with the EU must not be made more appealing than EU membership. The UK cannot have a special position as a hanger-on.”

Merkel speaks out: No 'cherry picking' for Britain in Brexit talks The European Union must consider limiting Britain’s access to its market if London fails to accept the bloc’s ‘four freedoms’ in Brexit negotiations, German Chancellor Angela Merkel said on Monday (9 January).

The VDMA statement came in response to claims by British Eurosceptics that German exporters will be desperate to strike a trade agreement with the UK after Brexit to ensure continued exports to Britain.

UK Prime Minister Theresa May plans to trigger the two-year Brexit process on Wednesday (29 March), saying no deal would be better than a bad deal.

This has worried the British manufacturing association EEF, which said UK exports to the EU – such as cars, chemicals and machinery – could face tariffs averaging 5.3% at the end of the two-year negotiating period if no deal was in place.

“The idea of being able to walk away empty-handed might be a negotiating tactic, but it would in reality deliver a risky and expensive blow,” Terry Scuoler, chief executive of EEF, Britain’s manufacturing lobby, said.

Britain’s Brexit minister, David Davis, has admitted recently that the government has not assessed the economic impact of leaving the EU without a new trade deal.