With most of the FTSE 100 supporting Remain and a number of entrepreneurs endorsing Brexit, some have suggested that the business community is split between corporates who support In and entrepreneurs who favour Out.
But I don’t think this crude dichotomy is accurate and, as an entrepreneur who supports Remain, I believe that the UK’s best interests are best served by staying in the EU. I am certainly not a starry-eyed pro-European federalist. I am passionate about business, not bureaucracy in Brussels. But I worry about what a future for the UK outside the EU looks like.
Since we joined the EU in 1973, we have had an ambivalent attitude towards European cooperation. In that year, I was working in the city as a young man, and three years later, started my worldwide currency business Travelex. Over the years, I have done business across continental Europe, and my argument on why the UK should remain part of the EU rests on three simple pillars.
First, the single market enables British companies to trade tariff-free with the rest of the EU. It opens up a market to UK business of over 500m people. A few years after I started Travelex, I took the business into the Netherlands and Belgium – the EU is the natural place for many British companies looking for the first stage of overseas expansion.
Nowadays Travelex has a presence in eight EU countries, and has used passporting licenses, which enable a firm to offer financial services across the EU. Building a business across Europe is not easy. The employment regulations in some countries inhibit investment. If it is hard enough doing business in Europe as a member of the EU, I fear it would become even harder if we left.
Second, a vote for Brexit would create uncertainty which would adversely affect business. In the period leading up to the referendum, we are already seeing unsettled currency markets and investment decisions put on hold. This would be prolonged if the UK exited.
No one knows exactly what form the UK’s relationship with the EU would take if we left. The negotiation timetable sets out a two-year process, but it’s highly likely it would take longer. Some on the Leave side dream of a relationship akin to Norway and Switzerland. But they both have to pay for access to the single market and are effectively subject to the EU’s free movement rules.
Furthermore, having endured the worst recession and financial crisis for 80 years, the UK economy has come through this “stress test” remarkably well in the circumstances. It is now one of the fastest growing economies in the G7 with one of the lowest unemployment rates in the EU. The EU has hardly been holding us back.
Third, I worry that a Brexit would damage the UK’s relationship with the rest of the world and could consign us to the margins of Europe and world affairs. Our trade arrangements with countries like China and India are set by the EU, helping us to trade all over the world. Business-wise, it is clear that many international firms base their HQs in London to access the single market. Brexit would definitely undermine London’s role as the financial capital of the world.
Our membership of the EU enables us to deal with cross-border policy challenges from energy and climate change to migration and security. The EU does not have easy answers to these complex problems, but it provides the forum for collaboration. The UK is the only country to be a member of the EU, the Commonwealth, the G8, Nato and the UN Security Council. Our active participation in these organisations demonstrates that cooperation is better than isolation.
The proposed EU reforms include welcome guarantees against ever-closer political union and recognition that the EU has more than one currency. I was never an advocate of the UK joining the euro. More broadly, my view was that the single currency was based on a flawed idea of one-size-fits-all (although for Travelex it proved to be more opportunity than threat). Recent events have proved this flaw to be the case.
The upcoming referendum is a once in a generation opportunity to have our say on the vexed subject of Britain’s relationship with the EU. Entrepreneurs are, by their nature, risk-takers. But I believe that leaving would be a risk too far, and moreover, that the benefits of our membership outweigh the costs. It is imperative that the UK remains a leading player in the EU.