Germany has rejected a plea by the UK foreign secretary, Jeremy Hunt, to resume arms sales to Saudi Arabia, denying that its embargo weakens Europe’s credibility or harms the European defence industry.

At a joint press conference with the German foreign minister, Heiko Maas, Hunt was told his plea for a resumption of arms sales made in a leaked letter had been rejected for the moment.

Maas said any future decision would be “dependent on developments in the Yemen conflict and whether what was agreed in the Stockholm peace talks are implemented”.

The two sides in the Yemen civil war met in Sweden last December to start a process of confidence building, including a limited ceasefire in the Red Sea port of Hodeidah. The UN special envoy to Yemen, Martin Griffiths, has not yet set a date for the resumption of the main talks, and few expect a settlement for many months.

Hunt raised the issue with Maas in talks that had been expected to be dominated by Brexit. At the joint press conference in Berlin, he ruled out imposing an arms sales embargo in the UK.

“We don’t believe that changing our commercial relationship with Saudi Arabia will help that. In fact we worry that it would do the opposite – it would reduce our influence on that process,” he said.

“In reality, because the UK has a strategic relationship with Saudi Arabia, we’d been able to play a very important part in making the Stockholm talks happen.”

Der Spiegel reported that London had privately lobbied Berlin to exempt major European defence projects like Eurofighter or Tornado jets from the embargo. Both aircraft contain German components. An export ban has therefore had a knock-on effect on other European companies involved in building the aircraft.

Hunt had warned in his letter that Riyadh was already seeking compensation from Britain’s BAE Systems over the German ban, Der Spiegel said.

He also wrote: “I am very concerned about the impact of the German government’s decision on the British and European defence industry and the consequences for Europe’s ability to fulfil its Nato commitments.”

Angela Merkel, the German chancellor, who was at the Munich security conference at the weekend, appeared to acknowledge the force of Hunt’s argument, supported by the European defence industry, when she said Germany and France needed to coordinate their arms sales export policies more closely if European defence integration is to function.

Merkel said: “We have because of our history very good reasons to have very strict arms export guidelines, but we have just as good reasons in our defence community to stand together in a joint defence policy. And if we want … to develop joint fighter planes, joint tanks, then there’s no other way but to move step by step towards common export controls guidelines.”

Hunt’s letter has been welcomed by the German defence industry. Hans Christoph Atzpodien, head of the defence industry association BDSV, said: “The letter shows how Germany’s arms export practices are costing it the ability to partner with its closest European allies.”

According to Der Spiegel, Hunt also wrote that the German government’s decision to halt arms exports to Saudi Arabia would cost German defence firms €2.3bn (£2bn) in revenues by 2026.

Hunt’s plea to overturn the German arms ban overshadowed his efforts to persuade Germany to take a more conciliatory approach to Brexit, especially the British government’s request that it is given a clearer legal undertaking by the European Union that the backstop for the Irish border will not be permanent.

Hunt said the aim of the talks was to get to a position where the British attorney general could change his legal advice to MPs and argue the backstop had an end date. He said future historians would be puzzled if Europe had not been able to sort out a new relationship with Britain.