Photographer: Chris Ratcliffe/Bloomberg

CBI Backs Staying in EU as Politicians Spar Over Canada Option

  • Survey finds four-fifths support membership of trading bloc
  • Cameron says Canada-style accord risks years of uncertainty

The Confederation of British Industry will campaign to keep the U.K. inside the European Union in the June 23 referendum after a survey found four-fifths of its members believe it would be best for their businesses.

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“The message from our members is resounding -- most want the U.K. to stay in the EU because it is better for their business, jobs and prosperity,” Director General Carolyn Fairbairn said in a statement on Tuesday. “Walking away makes little economic sense and risks throwing away the many benefits we gain from being part of the EU.”

The announcement didn’t come as much of a surprise. Last year, Vote Leave, one of the groups campaigning to get the U.K. out of the 28-member bloc, sneaked supporters into the CBI’s annual conference to heckle Prime Minister David Cameron and denounce the business lobby as the “Voice of Brussels.”

While 80 percent of CBI member organizations, weighted to reflect the make-up of the group, supported staying in the EU in a ComRes survey, 5 percent backed leaving. Even among small and medium-sized businesses, which are more likely to support leaving, 71 percent backed membership, the CBI said. The ComRes survey, of 773 CBI constituents, was carried out between Feb. 11 and March 7.

Cameron Appeal

In a video message released by the Britain Stronger in Europe group Tuesday to mark 100 days to go before the vote, Cameron said staying in the EU would ensure “lower prices in the shops, more jobs and safer streets,” and that this would be put at risk by quitting the bloc.

During a visit to port workers at Felixstowe, he poured cold water on suggestions that Canada’s trade deal with the EU could act as a model for Britain if it quits the EU. His comments were a direct riposte to London Mayor Boris Johnson, the highest-profile campaigner for a British departure.

“It’s taken seven years to negotiate and it’s still not in place,” Cameron said. “Can we afford seven years of uncertainty for our businesses, seven years when farmers won’t know whether the markets are going to be open for their produce, seven years where companies won’t know whether to invest in Britain because they don’t know what our trade deal’s going to be like?”

His comments were supported by former European Trade Commissioner Peter Mandelson, who said the U.K. would have to pay more in return for fewer benefits under such an arrangement.

‘Strategic Error’

“That is a major strategic error by the ‘Leave’ campaign as it exposes in one leap the inferior, weaker alternative future that they offer for Britain outside the European Union," Mandelson, a former government minister, said in a speech to the British-Irish Chamber of Commerce in London. He summed up the Canada deal as “new tariffs on trade, no influence and restricted market access. In short, you pay more for less.”

Some polls put the result of the referendum as too close to call. Advocates of a so-called Brexit have repeatedly accused the government of scaremongering by exaggerating the negative impacts of leaving the EU, while “Remain” campaigners have said it’s up to the “Leave” camp to spell out the alternative.

That led Johnson to advocate a deal along the lines of the one that Canada began negotiating in 2009, and which is expected to enter into force next year. The mayor defended his comments during his weekly LBC Radio phone-in show on Tuesday, saying Canada had eliminated about 98 percent of the tariffs with the EU and accusing the campaign to keep Britain in the bloc of trying to “panic people.”

Negative Campaign

“There is no reason why we should not do a deal very rapidly indeed,” Johnson told one critic, opposition Labour Party lawmaker Chuka Umunna. “Do you seriously imagine that with a net balance of trade in their favor, about 80 billion pounds a year, the EU is going to put up tariffs against us. Of course they are not. The sheer negativity, lack of optimism about our ability rises off the ‘Remain’ campaign like a vapor.”

As EU trade commissioner when the negotiations with Canada began, Mandelson said he’s “well-versed” in the deal, which “offers nothing like unhindered access to the single market.” If Britain sought similar terms, the negotiations would “travel at a snail’s pace” and the ultimate restrictions “spell disaster” for its financial sector, he said.

Lynton Crosby, who ran Cameron’s successful re-election campaign last year, wrote in the Daily Telegraph newspaper that the referendum could be won or lost on turnout.

“Poignantly, the challenge for both campaigns is the same: to raise the importance of the referendum outcome and demonstrate to their voters that there really is the potential for ‘Leave’ to win,” he wrote.

Voters, he said, see dangers on both sides. “The risk of leaving is the damage that could be caused to the U.K. economy. The risk of staying is the uncontrolled immigration that could result.”

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