I recently stood in the House of Commons and made the case
for the EU. I got a lot of flak for my efforts!
As someone brought up in the aftermath of the Second World War and as a former
Royal Navy officer, I am instinctively attracted to the EU project’s diplomatic
reach and its role in preserving international peace and security. But I
appreciate that in times of economic hardship, money sings.
To me, as well as to the wider UK business sector, the
economic benefits of sticking with the EU project are indisputable.
Chamber of Commerce’s recent report Help or Hindrance: The Value of EU
Membership shows that the majority of London businesses want to remain part of
the European single market. Business, they say, benefits from the free movement
of labour, which provides skilled workers, and access to many European trading
partners without stinging tariffs and other blocks to trade. Recently, 20 of
Britain’s most eminent business leaders penned a letter to the Independent stating that the "economic case to stay in the EU is overwhelming".
As I attempted to make this case in the chamber, it was clear
that my arguments weren’t universally accepted! One opponent pointed out that
the share of our exports going to the EU was falling, while the share with the
‘rest of the world’ was going up. He is right, but it’s not a reason to leave
An increasing proportion of our exports are going to the
rest of the world, particularly high-growth emerging markets. Given the
recession and slow population growth in the Eurozone, this is far from
surprising. Nonetheless, the EU remains by far the UK’s largest single export
market and will remain so for a good time to come. It is in our interests to be
able to sell into the EU, and have a say over its rules.
Supporters of an EU exit point out how fast our trade with
the rest of the world is growing, while simultaneously arguing that EU
membership obstructs the development of alternative export markets. Again, an
interesting point – but not a reason to leave the EU. My opponents really can’t
have it both ways. Within the EU, Germany exported four times as much as we did
to China in 2012. I want to be able to grow our trade to the rest of the world and
the EU . And we should heed recent reports from Washington warning that ‘opting out’ would exclude us from the holy grail of a US-EU free trade agreement worth hundreds of billions – and that a separate deal with Britain would be highly unlikely!
My challenger in the chamber also noted the UK’s
long-standing trade deficit with the rest of the EU, arguing that it would
not want to lose such a lucrative market. The implication is that we would be
in a strong position to secure ongoing access to EU markets following our exit:
our negotiation strategy, simply put, would be “You put tariffs on our exports
and we’ll put tariffs on yours”. Trade negotiations, like life, are not so
simple. There is every reason to think that, following our withdrawal from the
EU, barriers to trade in certain products and sectors would emerge that would
harm UK exporters and raise the prices faced by hard-pressed consumers.
By contrast, staying in and developing the single market in services, where we
run a trade surplus with the EU, would be greatly advantageous to us.
Isn’t it ironic that while the financial crisis has
precipitated an all-time lack of support for the EU amongst voters in the UK –
business is telling us the EU is in fact part of the solution to growing the
economy? Using vague statistical arguments to support an EU exit, regardless of
the facts, doesn’t make sense. We should wait for the outcome of
the government’s EU review, and support the renegotiated relationship that David
Cameron has promised to put to a referendum in 2017. Within the EU, the UK will
continue to thrive as a major player on the world stage and our economy will be