UK minus EU is another loser from Lawson

May 8, 2013

By Ian Campbell

The author is a Reuters Breakingviews columnist. The opinions expressed are his own.

Nigel Lawson is back in the ring and as sharp as ever. The UK chancellor who dismissed his critics as “teenage scribblers” in the 1980s – as he fomented a housing bubble that weighed on the economy for half a decade – is now throwing his weight behind a UK exit from the EU. It will make Britain stronger, he jabs. Someone should throw in his towel.

Lawson is looking east, towards Asia and emerging markets, and entirely overlooking an EU that is, he says, “past its sell-by date”. But why give up on your European neighbour, largest trade partner and the biggest global market? Lawson’s choice, between the EU and Asia, is worse than false. Leaving the EU would harm, not help, the UK in Asia and emerging economies.

At present, multinationals know that an investment in the UK is one in a leading EU economy that also, conveniently, has the international language of business as its mother tongue. If the UK exits the EU, its value as a European hub is lost. Headquarters and key staff might overlook it in favour of a continental European base.

UK businesses don’t want the risk of weakened ties with Europe. Yes, as Lawson rightly claims, EU red tape is a hassle and an annual UK contribution of 8 billion pounds could and should be slimmed down. Lawson mentions too the “foolish and damaging” financial transaction tax. But the UK can opt out of it, and is doing so.

The awkward truth is that the UK’s relationship with the EU, while argumentative and difficult, ultimately serves Britain well. Britain takes the benefits of EU membership without the risk of the euro currency experiment. It is successfully isolating itself from euro zone bailouts and Europe’s less wise steps.

It’s better for a nation to try to get on with its neighbours, even troubled or troubling ones, than to ignore them entirely. That is especially true when they continue to buy almost half your exports. The UK should stay in the European ring. It’ll be less of a global heavyweight if it steps out.

 

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