Sancho has lit up the Bundesliga since arriving from Manchester City, scoring eight goals and providing 13 assists this season in the league – the most of any player in Europe’s top five divisions.
His form has seen him linked with a return to the Premier League with Manchester United repeatedly cropping up in reports, but Watzke has dismissed that speculation and insisted the 19-year-old will be at Dortmund next season.
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"We will not sell him, that is fact. It is clearly discussed with every person who is involved that Jadon plays in the next season for BVB," Watzke told Eurosport Germany.
"His progress is brilliant. For his age he plays extremely remarkable because he does things you cannot plan like this. But we have to be careful that we do not trigger the hype. This boy just turned 19 years old.
"He is not allowed to lose a millimetre of focus because for the top players every thousandth counts. Cristiano Ronaldo has not been at the top of the world for many years because of his talent, but because of his focus no one other has.
"If Jadon proves that in the next few years, we can talk about a world career as well. At this time, we can only speak about his huge potential."
Dortmund will try and protect their two-point lead in the Bundesliga when they visit title rivals Bayern Munich on Saturday.
Why would Sancho want to leave now?
He’s at a massive club, playing regularly and has shown other young English talent what can be achieved by moving abroad. He’s still raw, highlighted by his mediocre displays in the Champions League against Tottenham and on international duty with England, and needs to establish himself consistently. There's no need to put his progress in jeopardy when he's already in a perfect place.
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