Two reports published by TheCityUK over the weekend have advised that “leaving the EU poses very significant risks to the UK’s future, undermining economic well-being and the ability of business to grow and compete in world markets”. The findings of the reports also acknowledge that “the EU has a positive impact on driving UK trade, high productivity and growth”.
Chris Cummings, Chief Executive of TheCityUK said: “Current EU membership not only gives the UK access to the most powerful tools to promote its interests including voting and veto rights, but it is also significantly tailored to meet UK-specific objectives. By contrast this research clearly shows that leaving the EU would pose a number of risks. Uncertainty about what a “no” vote in any referendum would entail is one of the most significant.
The first report “A legal assessment of the UK's relationship with the EU” examines legal research commissioned from global law firm Clifford Chance. The latter reviewed “the legal implications of eight different EU relationship scenarios – three where the UK remains a member and five alternatives to membership – and their impact on financial services”.
Malcolm Sweeting, Senior Partner of Clifford Chance continued: “The success of the UK financial services industry is to a large extent built on EU Internal Market legislation. To abandon this for some untried, unknown and unpredictable alternative would carry very significant risks. The UK is a powerful player in the EU and should retain the capacity to push for reform as a member."
The other report titled “Analysing the case for EU membership - How does the economic evidence stack up?” focuses on finding the factors that drive growth and how they are connected to the country’s EU membership.
The reports argue that a “Brexit” would involve costly alternatives for UK business and finance. It also risks leaving the UK subject to EU regulation without any power to influence it. This loss of influence would damage the UK through uncertainty and, by implication, a decline in investment.
Gerry Grimstone, Chairman of TheCityUK commented: “Our research clearly shows that leaving the EU would seriously damage economic growth and jobs in the UK. But the EU can and must be improved. It mustn't interfere in things which it does not need to do and it must make a better job of doing the things it has to do. We need to continue saying this loudly and clearly. London is Europe’s financial centre so there is a strong national interest in getting this right.”
TheCityUK is not the first organisation to publish a report on EU membership. Among others, the CBI expressed its stance on the issue several times, arguing that the UK’s membership is beneficial for the UK’s business.
In January this year, the UK Prime Minister David Cameron promised to hold a referendum on UK membership of the EU if he is re-elected at the 2015 General Election.