Germany Favors 2016 U.K. Referendum to Reduce Uncertainty

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German Chancellor Angela Merkel
Angela Merkel, chancellor of Germany. Photographer: Krisztian Bocsi/Bloomberg

Chancellor Angela Merkel’s coalition wants the U.K. to bring forward its European Union referendum to avoid lengthy ambiguity over British membership in the bloc.

While the chancellery fundamentally views a referendum as a bad idea, if Prime Minister David Cameron does move forward, then 2016 is seen as the lesser of two evils, said an official with knowledge of Merkel’s thinking. A 2017 vote, as currently planned, would create the added headache of colliding with Germany’s parliamentary election, the official said.

“If the situation drags on for too long, uncertainty rises,” said Axel Schaefer, a deputy parliamentary chairman for European affairs for the SPD, Merkel’s junior coalition partner. “An early referendum is welcome.”

Cameron, who will meet Thursday in Riga, Latvia, with Merkel and other European leaders for the first time since his re-election, has pledged to renegotiate EU membership terms and hold a referendum on the outcome by the end of 2017. The prime minister will set out his legislative program, including the framework for the plebiscite at the heart of the Conservatives’ election manifesto, in a speech that Queen Elizabeth II will read next week to open the new parliament.

While Germany wants the U.K. to stay in the EU and is open to limited reforms, especially when it comes to social welfare abuses, Merkel is extremely skeptical with regard to any major treaty change, said the person, who asked not to be identified discussing internal deliberations.

Seeking Clarity

“The quicker the referendum comes, the better,” said Juergen Hardt, a member of Merkel’s Christian Democratic Union who coordinates his party’s transatlantic policy. “For one, we would get clarity on the U.K.’s EU membership, and it would also probably be strategically sound for the British premier to settle the matter fast.”

Norbert Roettgen, head of the foreign affairs committee in the German Bundestag and a CDU member, said it’s up to the U.K. to decide when to hold the referendum -- a move that he sees as creating a dilemma for the prime minister.

“Even if Cameron can achieve certain changes at the EU level, he will never convince the Europe skeptics in his country,” said Roettgen, who will discuss the matter with U.K. reporters when he travels to London in two weeks. “An exit by Great Britain will only create losers: the British themselves, the EU, the Germans and also the Americans.”

Fallout from an exit could include job losses -- a fact highlighted Monday when Deutsche Bank AG said it’s considering moving activities out of the U.K. in the event of a “no” vote.

Most Powerful

While the Bank of England, business and the Labour opposition say bringing the vote forward would reduce uncertainty, Cameron must also deliver sufficient reforms to please anti-European members of his own party. The Tories won a surprise majority in the May 7 election that will allow the party to govern without a partner. Still, Cameron’s razor-thin edge of 331 seats out 650 means he can’t afford much dissent.

Some German lawmakers say Cameron should hold a vote when he’s at his most powerful.

“Cameron might still benefit from the election,” said Niels Annen, an SPD party board member and foreign policy expert. “The sooner the referendum takes place, the stronger he is. As he will be trying to keep Britain in the EU, it’s important that he is in a strong position.”

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