19 November 2015

Financial Times: British business must not stay silent in the Brexit debate

The decision facing Britain on whether to remain in Europe or to leave is one of the most far-reaching economic choices we will face in our lifetimes. Inside Europe we can seize the opportunities created by the single market. This is essential when we are up against competitors to the east and west, each with their own regional trading blocs.

If we leave, history may judge it the UK’s greatest strategic mistake of the 21st century — walking away from the world’s largest free-trade area in an era when global co-operation is the surest route to political and economic influence. [...]

Today I have one clear message to [British businesses]: speak up about Britain’s place in Europe. As someone with four decades of business experience — from the shop floor to the boardroom — I refuse to accept that British business should be a silent partner. [...]

So far those who advocate leaving the EU have been timid in explaining what “out” really means. That is perhaps to be expected given the robust challenge they have already faced.

Mark Carney, governor of the Bank of England, has outlined how Britain’s economy has been made stronger and more dynamic by EU membership. The Chinese and US administrations have indicated that Britain is a more important partner within the EU than outside. Standard & Poor’s has said Britain’s credit rating could be downgraded if the country looks likely to leave the EU. The UK head of Citigroup, the American bank, has warned that a British exit would be costly for London and that businesses may base themselves elsewhere. Analysts at Morgan Stanley has have described the possibility of a return to recession if we left.

Meanwhile, no credible alternative has been articulated. Following the path of Norway and Switzerland — who pay for access to the single market but have no influence over the regulations they must accept — would weaken our control over our economic affairs.

We could bet the bank on a trade agreement with the EU, but there is no evidence that we would achieve anything other than terms that are worse than the ones offered by our current relationship.

Those who want Britain to leave Europe need to explain how their plans to stop contributing to the EU budget and end the free movement of citizens between Britain and other EU states are compatible with the full, unfettered single market access we now have. They need to provide evidence of how Britain’s trading position would be improved in the future settlement they imagine.

But they cannot do it. Their plans would sacrifice today’s economic benefits for a leap into the dark tomorrow.

I encourage UK businesses, whatever their point of view, to join me in this debate. We need to be clear about the economic consequences that stem from Britain’s membership of the EU. And we also need to be forthright about what would happen if we left.

Full article on Financial Times (subscription required)

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