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Energiewende

By Andrew Whitehead on Feb 8, 13 08:59 PM in

It's official: just when Germany expected us to head for the EU exit door, it seems we're their biggest trading partner.

According to recently released Bundesbank figures, the UK has now overtaken France as Germany's biggest global trade partner - with trade between the two countries hitting €153bn in the first 9 months of 2012.

It's probably a mistake to view this as a prelude to a waning of Germany's recently strained enthusiasm for the Eurozone core. Nonetheless, it's welcome news for UK plc, and coincides with a rise in British goods exports to Germany by 20% over the first 3 quarters, despite the continued economic gloom.

Perhaps unsurprisingly, one of the key UK export markets to Germany is car components - with the Midlands a key player.

But UK green goods and services are another success story. At the last count, the sector was valued at around £122bn, and employs almost one million people. Key sub-sectors are alternative fuels, building technologies and wind energy, with wave and tidal energy, and carbon finance also making a strong showing.

According to latest government figures, we exported £121m more green goods and services to Germany than we imported from them.

So all the more surprising, then, to see UK companies apparently so thin on the ground at this week's E-World energy fair in Essen, Germany.

In what is billed as the world's largest energy (and water) trade fair, I was expecting to be tripping over UK companies competing to win a share of business in Europe's largest economy.

The opportunities in the energy sector are huge, in light of what the Germans called "Energiewende" - the transition and reshaping of the industry in response to nuclear closures post-Fukushima and a surge in renewable energy (amongst other things). There are many themes that will be familiar to observers of the UK utility scene; a huge investment programme in transmission grids, new power stations and alternative energy technologies, and ever-increasing demand for innovative solutions to improve energy efficiency and develop smart grids.

However, if the long list of exhibitors in Essen was anything to go by, the domestic German utilities, manufacturers and service providers more or less had all bases covered.

Perhaps, with our own version of the "Energiewende" underway, there are enough opportunities for UK companies closer to home right now. A February trip to North Rhine-Westphalia in Germany's industrial heartland is, after all, unlikely to be on the top of anyone's Bucket List.

However, it's clear that the UK and Germany have a lot more in common than a royal family and an unfair reputation for dodgy cuisine. A healthy trading relationship, built on a shared belief in liberal free market values, looks set to play an increasingly central part in the current debate about the UK's role in Europe.

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