From Grexit to Brexit: UK industry now says the in/out referendum is good for your health

Mr David Cameron, UK Prime Minister at the last EU Council last December (Council TVnewsroom, 18/12/2014)

So it is like this. In politics you need to be a sheer opportunist. You have to grab every inch of opportunity available to polarise your electorate and get your message through. Britain’s Prime Minister Cameron, an old fox in UK politics, knows how to do this very well. Yesterday the annual conference of the British Chamber of Commerce was held in London and UK business leaders were “called” to vote for “Brexit”.

Grexit & Brexit

Grexit, Brexit you name it but it is true that lately the “exit” word starts to fit very well with the initial letters of many EU member states. This week Europe and the world are expecting Brussels to become the modern “Hot Gates” where modern Leonidas of politics, Greek Prime Minister Tsipras, is going to give one of Greece’s and Europe’s last fight against “austerity”, as a Greek Syriza partisan would say. In reality it is nothing but a crash test of how Brussels understands the problems of its member states and more so how Europe can answer with solidarity to the danger of the extreme political medieval sirens that sound like melodies to more and more Europeans today. These days Grexit is put again on the table and this constitutes a perfect setup for UK to also play its Brexit ball.

UK elections

Less than 100 days before one of Europe’s most important upcoming elections the political parties in Britain give it all to convince the undecided voters. In the most recent poll of the UK General Election, Labour gathered 34%, Tories 33%, UKIP 14% and Liberal Democrats 7% of the votes. In a neck and neck political battle, where Ed Miliband is slightly ahead, Mr Cameron played yesterday his strongest card, business. What is striking though is to notice that the Tories are running out of political arguments and thus they need UK’s industry to be in favour of the promised 2017 EU in/out referendum to make ends meet.

Gimme referendum!

Mr John Longworth, Director General of the British Chambers of Commerce, during yesterday’s London conference where UK’s biggest entrepreneurs convened, not only did he speak in favour of the referendum to stay or leave the EU but also called Mr Cameron to do it earlier! “We need to bring the referendum date forward because two and a half years of uncertainty isn’t good for growth and investment”, the strong man of Britain’s industry stressed yesterday. Then he continued: “It should be no more than 12 months after the general election!”.

He later talked about how Britain is too great to need anyone: “To those who believe that Britain is better served by disengaging, either from nearby trading partners, or from the pursuit of economic growth, I say that it is only if we deliver an open and enterprising economy that we will meet our aspirations, and it is only through growth that we will avoid becoming a Ruritanian backwater or a living museum,”…“The next government must set out what it will do to protect the United Kingdom against the prospect of being in a club where all the decisions are made by, and for, the eurozone.”

Staying put at the island’s perennial belief that the Eurozone is the devil, he further elaborated: “More than any repatriation of powers, businesses want to know that the UK has safeguards against being drawn closer to the eurozone – especially as history tells us that currency unions inevitably fall apart unless there is real political, economic and social integration”…“Without true reform, business support for the European project is far from guaranteed. A new settlement for Britain in Europe is essential to achieving our economic ambitions – helping our businesses succeed here at home, and across the world.”…“Above all, the debate over Europe must not be hijacked by political ideology. Economic pragmatism – what’s best for Britain, for British business, for our national growth ambitions – must win the day.”

Then Matthew Elliott, CEO of Business for Britain, directly attacked the big rival, Labour party, which is not supporting the EU in/out referendum promise: “The polls are clear, business backs an EU referendum as firms know it is the only way to secure a new, more competitive deal with the EU. Those who claim to want changes but oppose the only way to ensure them are doing little more than paying lip service to the idea of reform. Labour’s opposition to a referendum might give it a good soundbite, but it also reveals the party is scared of voters and ignorant to what business really wants.”

Referendums good for your health?

Normally one would expect the UK industry not to be supportive of a clear instability that any referendum would bring, particularly of this existential essence. It is common knowledge that UK is investing a lot on exports to the EU and also that numerous companies are settled in Britain as EU headquarters. UK has been for a long time a fertile place for business and investment. How is it possible for business people to be in favour of a Brexit, which is estimated that would obviously shrink economic growth?

Already some of the business attendees of London’s business conference yesterday were not entirely supportive of Mr Longworth’s radical statements. “We need to have a proper discussion about the benefits or not of being part of the EU,” John Holland-Kaye, CEO of Heathrow airport, told the FT. He continued like that: “We’ve actually had this sitting over our heads for years, for decades. It’s not a trivial choice and we need to have enough time to have a proper debate.” Obviously Mr Holland-Kaye would prefer to properly table the matter instead of setting up referendums asap.

What is more, big investment companies openly express their doubts over a Brexit. ING economist James Knightley said to Reuters: “As we saw with last year’s Scottish independence vote, foreign investors may take fright with UK asset prices and sterling likely to come under downward pressure”…”The economy will likely lose momentum and the BoE may raise interest rates more cautiously,” he stressed.”If the UK votes to leave, we may see plunging UK asset prices with business confidence weakening too” the economist argued.

Moreover, Witold Sobkow, Poland’s ambassador to the United Kingdom, he expressed yesterday at the same conference a deep pro-European approach: “No arrangement other than full membership” of the European Union can offer similar benefits to fellow European nations”…”We’d like to see the UK being an active member of the EU, shaping the policies of the EU. We agree eye-to-eye on most things when it comes to the single market.” He also argued that “If Britain left the European Union, it would be a disaster for countries like Poland because we would lose the balance we had”.

Stay

All in all, obviously any EU member state should have the right to define its own foreign and economic policy. Every EU member state is independent and autonomous but at the same time should abide by the rules of the Union of countries that has been formed to promote a better economy and a better peaceful society. Those are the the basics. Hearing about Grexits here and Brexits there is not constructive neither for the country nor for the European Union.

Political poverty

Before closing, coming back to the UK, it is truly astonishing that the political elite of Britain is running short of political ideas and insights. The situation is so sad that the conservative Prime Minister launched a radical promise for a EU In/Out referendum, if he is to be re-elected. More so, things are getting so cheap that even the business leaders now ask for this “vaguely understood” Referendum to happen sooner than ever. They want it and they want it now! Is this “Referendum holy grail” the only reason the Tory voter will vote again for Mr Cameron? And if so, does she even know what the question of the Referendum will be?

People are people, politicians are politicians but clearly you cannot hold a democracy to conservatism with the promise of a ball of ice-cream due in two years time.