From manufacturing to financial services, the chorus of business leaders speaking out about the risks of Brexit is getting louder.
By Will Cousins
In many modern car plants, such as those which have thrived across the UK in the last few years, a vehicle will roll off the production line every sixty seconds. Business leaders do not speak up for EU membership quite so regularly, but recently, that has seemed to change.
On Monday, the Ford Motor Company’s boss in Europe, Jim Farley, told listeners that “being part of the EU is critical for business.” One-third of Ford’s engines are manufactured in the UK- that’s two million a year. The company employs 14,000 people at manufacturing and research centres in Basildon, Bridgend, Dagenham and Halewood. Mr Farley said that he “really hopes” the UK does not leave the EU.
The reaction to his comments among eurosceptics has been instructive. On social media, they pounced on the fact that Mr Varley did not explicitly say that Ford would pull investment from the UK if we left the EU. If nothing else, this demonstrates how little confidence they have in their own case- the fact that a multinational has not raised the possibility of pulling out of the UK is regarded as a victory. Of course foreign car manufacturers would not up sticks and leave the moment Britain left. But the fact that they are so unequivocal about the benefits of membership is striking.
Volume car manufacturers, like Ford, are in Britain in order to sell to the EU. If eurosceptics do not understand this, they were clearly not listening to the talk given by industry expert Dr John Wormald, at a conference last month attended by many of the leading lights of the anti-European movement. Japanese cars face a 10% tariff when exported to the EU. Domestic European manufacturers, particularly in France and Italy, are having a difficult time. Would their governments really allow cars made in Britain to be sold across the EU, tariff-free, if the UK left the EU? Of course not. They would take the opportunity to eat our lunch.
It isn’t just the motor industry which is worried by the prospect of a Brexit. Siemens, the German engineering giant,employs 13,760 people in Britain. It is currently investing £310 million in a new plant in Hull, to manufacture offshore wind turbines. Surely no project could fit in better with the government’s intention to “rebalance” the economy, and stimulate a “march of the makers.” Manufacturing jobs, in the green energy sector, in the North of England- what more could you want?
That question might be academic if we leave the EU. The project’s director, Finbarr Dowling, told the Hull Daily Mailtoday companies like Siemens could “think again” about investing in the UK, were we to leave. His comments were unequivocal: “Look at the benefits we have of inward investment into this country. We are very much part of that European family and we want to continue like that. When I look out, all to the east is Europe, so we want to be able to export to Europe and we have a better chance of doing that if we are in the union.” This is far from the first time that Siemens UK has expressed its fears about the possibility of Brexit.
Let’s move from Hull to London, and from manufacturing to financial services. The Lord Mayor of London, Alan Yarrow,has spoken of London’s role as the financial capital of Europe. He put the key point very well in a speech on Monday: ““We have the leading international financial centre of the world: that cannot live on a hinterland of 65 million people. We are and will continue to be the financial centre for Europe because we’ve got 600 million people sitting on our doorstep.”
Banks outside the Single Market do not have the passport to provide financial services in the Eurozone. Outside the EU, the UK government would have no power to decide the direction of EU-wide financial regulation, as this recent House of Lords report made clear. Few people in the City can see the attraction of cutting ourselves off from our largest and most important export, and incentivising foreign banks to set up shop in Frankfurt or Paris instead of London.
Yarrow, pointing to a recent YouGov poll that showed a 10 percentage point lead for staying in, describes Brexit as “unlikely.” We agree with him, but businesspeople would be unwise to sit back and assume that it is impossible. On the economy, voters respect the opinions of business leaders. The best way to safeguard the exports and investment which create jobs and growth in Britain is to speak up, loud and clear, about the benefits for business of being in the European Union.