From carmakers to cats, all face Brexit disruption, Merkel says

BERLIN (Reuters) - Everything from just-in-time auto supply chains to the free movement of workers and even their pet cats and dogs will be thrown into question by Britain's exit from the European Union, German Chancellor Angela Merkel said.

She told a G20 trade union event in Berlin on Wednesday that, while Britain would be free to change rules to its own advantage after leaving the bloc, it would pay a price if the EU had to take steps in response to preserve a level playing field.

"If the British government ends the free movement of people, that will have its price," the centre-right chancellor said.

"That's not malice," she added. "(One) cannot expect to have all the good sides and then say there will be an upper limit of 100,000 or 200,000 EU citizens, no more, or just researchers, but please nobody else. This will not work."

The fact that so many areas of policy have for decades operated under EU rules meant that the disruption following Brexit could extend into wholly unexpected parts, she said in response to a question from a British trade union official.

"Currently, the 250,000 pets, cats and dogs that travel from Britain to the continent or the other way around each year are managed within an EU framework," she said. "Now they'll need hygiene certificates - things we don't even remember."

The EU would "naturally" consider the interests of the 48 percent of Britons who had voted against Brexit, she said, but it was for trade unions to push for a level playing field between Britain and the bloc to be preserved to minimize disruption to British employers and employees.

"The British auto industry lives on supplies from continental European countries," she said. "It is up to the British side, who are expressing the wish to have the fewest possible distortions."

Most European governments say preserving the integrity of the EU is their priority in the negotiations, but some economists and businesses have urged efforts to avoid a precipitous exit.

The council of advisers to the German economy ministry called on economy minister Brigitte Zypries on Wednesday to push for Britain to join the European Free Trade Association on its exit from the bloc, the Frankfurter Allgemeine reported.

The newspaper said the advisory council had warned there was little chance of a sufficiently deep agreement being concluded by the planned 2019 exit date. Joining EFTA, a bloc including Norway and Iceland which Britain quit on joining the EU in 1973, would minimize disruption, they were quoted as saying.

(Reporting by Thomas Escritt and Michael Nienaber; Editing by Tom Heneghan)