Trade between the United Kingdom and the European Union is worth hundreds of billions of dollars, and businesses across Europe want it to continue uninterrupted. The sticking point: The British have made the Europeans really, really mad.
In the wake of the U.K.'s vote last week to divorce itself from the world's largest trading bloc, a debate is flaring about what commerce between the U.K. and EU should look like. On the one hand, well-entrenched business interests want it to continue with as little disruption as possible. But leaders in Europe are strongly motivated to punish the U.K. for the Brexit.
"The politics are going to be really messy," said Scott Miller, senior advisor at the Center for Strategic and International Studies, "and there's going to be an urge to punish."
The U.K. is the EU's second-biggest economy, and the fifth largest economy on earth. Its exports to the EU were worth 226.7 billion pounds ($305.7 billion) in 2014, and its imports from the bloc came in at 288.3 billion pounds ($388.7 billion) that year, according to data from the U.K.'s Office for National Statistics.
Big European companies don't want to lose the U.K. as a market, but their worries run deeper than that. EU trade rules make it possible for firms that make complex products — automakers, aircraft manufacturers, chemical companies and the like — to source components from multiple countries at once. They don't want to see that system begin to fall apart, because it would force them to redesign very complicated supply networks.
Declaring that it would be in "nobody's interest to make the international flow of goods more expensive," the association said in a statement that German car companies operate roughly 100 facilities in the U.K., a number that has risen 30 percent since 2010. The U.K. automobile market reached an all-time record volume of 2.6 million new cars in 2015, and half of them were German.
The U.K. wants to hold onto those trade relationships, too. Its government does not, however, want people from EU member states to have the right to work and live in the U.K. Prime Minister David Cameron, meeting with 27 EU heads of state Tuesday night, suggested that the EU should be flexible on the freedom of movement rule if it wants to maintain trade with the U.K..