London’s position as a global financial center could be harmed if the U.K. left the European Union, according to Commerzbank AG.
“Rapidly growing financial centers in Asia and the Middle East would be well-placed to capitalize,” London-based economist Peter Dixon said in the note published on Wednesday. “One advantage which the U.K. financial-services industry enjoys under current arrangements is unfettered access to a market of 500 million people; operating outside the EU would eliminate this benefit in return for very uncertain gain.”
Prime Minister David Cameron has said he will hold a referendum on Britain’s membership of the EU before the end of 2017. Before then, he wants to change the way the 28-nation bloc works so some powers return to national governments. Voters saying Britain should stay in the EU led those wanting to leave by 45 percent to 37 percent, pollster Survation Ltd. said last month.
Britain leaving would be a gamble with the country’s economic and political interests and there’s little evidence of a beneficial payoff, Commerzbank said.
A reduction in trade could make it harder to control unemployment while it’s unlikely that eliminating EU regulation would boost the British economy, according to the German-based bank. “Exit simply means that the U.K. will be faced with a different set of problems.”