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Richard Ottaway MP: To the colleagues who heckled me, I say: it is in our national interest to stay in the E.U

Ottaway RichardRichard Ottaway is the Chairman of the Foreign Affairs Select Committee and MP for Croydon South. He writes here in a personal capacity.

I recently stood in the House of Commons and made the case for the EU. I got a lot of flak for my efforts!

As someone brought up in the aftermath of the Second World War and as a former Royal Navy officer, I am instinctively attracted to the EU project’s diplomatic reach and its role in preserving international peace and security. But I appreciate that in times of economic hardship, money sings.

To me, as well as to the wider UK business sector, the economic benefits of sticking with the EU project are indisputable.

The London Chamber of Commerce’s recent report Help or Hindrance: The Value of EU Membership shows that the majority of London businesses want to remain part of the European single market. Business, they say, benefits from the free movement of labour, which provides skilled workers, and access to many European trading partners without stinging tariffs and other blocks to trade. Recently, 20 of Britain’s most eminent business leaders penned a letter to the Independent stating that the "economic case to stay in the EU is overwhelming".

As I attempted to make this case in the chamber, it was clear that my arguments weren’t universally accepted! One opponent pointed out that the share of our exports going to the EU was falling, while the share with the ‘rest of the world’ was going up. He is right, but it’s not a reason to leave the EU.

An increasing proportion of our exports are going to the rest of the world, particularly high-growth emerging markets. Given the recession and slow population growth in the Eurozone, this is far from surprising. Nonetheless, the EU remains by far the UK’s largest single export market and will remain so for a good time to come. It is in our interests to be able to sell into the EU, and have a say over its rules.

Supporters of an EU exit point out how fast our trade with the rest of the world is growing, while simultaneously arguing that EU membership obstructs the development of alternative export markets. Again, an interesting point - but not a reason to leave the EU. My opponents really can’t have it both ways. Within the EU, Germany exported four times as much as we did to China in 2012. I want to be able to grow our trade to the rest of the world and the EU .  And we should heed recent reports from Washington warning that ‘opting out’ would exclude us from the holy grail of a US-EU free trade agreement worth hundreds of billions – and that a separate deal with Britain would be highly unlikely!

My challenger in the chamber also noted the UK’s long-standing trade deficit with the rest of the EU, arguing that it would not want to lose such a lucrative market. The implication is that we would be in a strong position to secure ongoing access to EU markets following our exit: our negotiation strategy, simply put, would be “You put tariffs on our exports and we’ll put tariffs on yours”. Trade negotiations, like life, are not so simple. There is every reason to think that, following our withdrawal from the EU, barriers to trade in certain products and sectors would emerge that would harm UK exporters and raise the prices faced by hard-pressed consumers.  By contrast, staying in and developing the single market in services, where we run a trade surplus with the EU, would be greatly advantageous to us.

Isn’t it ironic that while the financial crisis has precipitated an all-time lack of support for the EU amongst voters in the UK – business is telling us the EU is in fact part of the solution to growing the economy? Using vague statistical arguments to support an EU exit, regardless of the facts, doesn’t make sense.   We should wait for the outcome of the government’s EU review, and support the renegotiated relationship that David Cameron has promised to put to a referendum in 2017. Within the EU, the UK will continue to thrive as a major player on the world stage and our economy will be stronger.


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