Cameron to Push EU Trade With Obama as Tories Dream of Exit

Photographer: Oli Scarff/AP Photo

Cameron will meet with President Barack Obama at the White House today to encourage talks on a trade deal between the EU and U.S. as part of preparations for the Group of Eight nations summit the U.K. hosts next month. Close

Cameron will meet with President Barack Obama at the White House today to encourage... Read More

Close
Open
Photographer: Oli Scarff/AP Photo

Cameron will meet with President Barack Obama at the White House today to encourage talks on a trade deal between the EU and U.S. as part of preparations for the Group of Eight nations summit the U.K. hosts next month.

U.K. Prime Minister David Cameron starts a visit to the U.S. overshadowed by his Tory lawmakers planning a rebellion over Britain’s membership in the European Union and a call from a Cabinet minister to exit the bloc.

Cameron will meet with President Barack Obama at the White House today to encourage talks on a trade deal between the EU and U.S. as part of preparations for the Group of Eight nations summit the U.K. hosts next month. At home, Britain’s membership in the bloc is being increasingly questioned. Education Secretary Michael Gove and Defense Secretary Philip Hammond both said yesterday the U.K. should consider quitting the EU.

While the premier has pledged to renegotiate the terms of Britain’s EU membership if he wins the 2015 election and then hold a referendum on the result by the end of 2017, that commitment has not proved to be enough for some of his own party. More than 20 Conservative Members of Parliament have put their names to a parliamentary amendment expressing “regret” that no provision paving the way for a U.K. exit was included for this legislative session in the Queen’s Speech.

“What they’re doing is putting the prime minister in an impossible situation,” Malcolm Rifkind, a Conservative lawmaker and former foreign secretary, told BBC Radio 4 today. “They will have split their own party, they will cast questions over the prime minister’s authority, and indirectly, unintentionally, they will be helping the Labour Party’s prospects at the next election. That is a pretty odd tactic.”

‘Banging On’

Cameron used his first conference speech as Tory leader in 2006 to concede the party had alienated voters by “banging on” about Europe. Five years later, the issue still dominates Tory debates, all the more so after a surge of support for the U.K. Independence Party, which campaigns for withdrawal from the bloc, in local elections on May 2. Nick Clegg, the deputy prime minister who leads Cameron’s Liberal Democrat coalition partner, wants the U.K. to remain in the EU.

“Cameron is caught between his own euroskeptic MPs who want to hold on to the party’s base of support and the Lib Dems who won’t allow any mention of an EU exit bill while they’re in coalition,” Mark Wickham-Jones, professor of politics at Bristol University, said in a phone interview. “The real issue here is that Tories are banging on about the EU and talking to themselves when voters are worried about the economy.”

Trade Goal

Cameron has made setting up talks on a free-trade agreement between the EU and U.S. a key goal of his meeting with Obama during his three day visit. The deal would be worth 10 billion pounds ($15 billion) a year to the U.K. economy, Cameron’s office said, citing research by the Centre for Economic Policy Research, demonstrating the benefits of Britain’s EU membership.

Eliminating all tariffs on goods could save British exporters 1 billion pounds a year while an additional 9 billion pounds in benefits could come from reducing non-tariff barriers, the research cited by Cameron showed. The automotive sector could see a boost of 7 percent in total output, financial services growth of 1 percent and the chemicals sector 1.5 percent, it said.

“When times are tough, some want to put the barriers up, to look inwards, and to protect themselves from the world,” Cameron wrote in an op-ed for the Wall Street Journal published today. “But Britain and America stand for a better way. We have a precious opportunity to transform the global economy -- not by less openness and less free trade, but by more,” he said. “And we must do everything possible to seize it.”

Not Happy

Yesterday Gove, a key Cameron ally, told the BBC’s “Andrew Marr Show” that he is not “happy with our position in the European Union,” adding that “my preference is for a change in Britain’s relationship with the European Union” and there were “advantages” to being outside the bloc. He said he would abstain on the rebel amendment this week.

By promising a referendum in January, Cameron had hoped to shelve the issue of Europe until after 2015. On May 7, former Chancellor of the Exchequer Nigel Lawson prompted fresh debate when he urged a U.K. exit, a call echoed by Michael Portillo, a former defense secretary. Margaret Thatcher’s biographer said May 8 that she too had concluded Britain should leave.

Justice Secretary Chris Grayling told the Sunday Times newspaper yesterday that he “is firmly on the euroskeptic wing” of the Tory party. About 100 Tory lawmakers may vote against the government on the amendment in Parliament this week, the Sunday Telegraph said.

‘Every Sympathy’

“I’ve got every sympathy with people who say that they want to ensure that we can give the assurance of the in-out referendum taking place,” Home Secretary Theresa May, a Conservative, told Sky News. “Obviously I don’t think it’s right for ministers to effectively vote against the policy program we’ve put forward in the Queen’s speech.”

Hammond dismissed talk of a party split, telling the BBC’s “Sunday Politics” that the Tories are “violently agreeing here.”

“We all believe that there needs to be a referendum on Europe,” he said. In another BBC interview later, Hammond hardened his position. “If the choice is between a European Union written exactly as it is today and not being a part of that then I have to say that I’m on the side of the argument that Michael Gove has put forward,” he said.

Labour’s home affairs spokeswoman, Yvette Cooper, said the Tory position means uncertainty for business as the U.K. emerges from recession.

“There is a kind of frenzy going on in the Tory party about a vote this week,” Cooper told the “Andrew Marr” show yesterday. “Utterly incomprehensible -- you could have government ministers potentially voting against their own Queen’s speech.”

To contact the reporters on this story: Kitty Donaldson in London at kdonaldson1@bloomberg.net or Thomas Penny in the U.S. at tpenny@bloomberg.net

To contact the editor responsible for this story: James Hertling at jhertling@bloomberg.net

Press spacebar to pause and continue. Press esc to stop.

Bloomberg reserves the right to remove comments but is under no obligation to do so, or to explain individual moderation decisions.

Please enable JavaScript to view the comments powered by Disqus.