The Confederation of British Industry (CBI) has warned politicians that the UK’s future relationship with the European Union (EU) cannot be based on ‘halfway house’ models such as those of Norway and Switzerland, which do not offer a credible option.
Ahead of a House of Commons vote on Friday on a bill committing the UK to an in-out referendum before the end of 2017 on continued EU membership, the business lobbying group said a similar form of associate membership was not a credible option.
A report issued by the CBI concludes that while such arrangements have proved successful for Norway and Switzerland, they would leave UK businesses on the margins of the world’s largest trading bloc, operating under market rules over which it had little or no influence.
Norway and Switzerland are not EU members, but both have some access to the single market. Norway is a part of the single market through its membership of the European Economic Area (EEA), while Switzerland has negotiated a free trade deal and more than 120 bilateral agreements with the EU.
However, interviews with a wide range of Norwegian and Swiss businesses, politicians and other stakeholders convinced the CBI concluded that both countries have to comply with swathes of EU laws and standards without having the power to influence the way they are framed.
The CBI also noted that negotiating trade deals had taken many years and proved complex and time-consuming, leading to extra costs and uncertainty for Swiss ¬businesses. Switzerland also has no formal channels to influence EU legislation.
Katja Hall, the CBI’s chief policy director, commented: “Norway still pays the bills and has as much of a say on the single market as Liechtenstein, which is not my idea of greater sovereignty.
“The debate now needs to focus on the best way to use our seat at the table and get the wheels turning on the kinds of reform that will make all of Europe more competitive.”
She added that businesses would lend support to what was best for growth, jobs and the long-term health of the UK economy – retaining access to the single market in a reformed EU. The test for those arguing that the UK must remain in the EU and for those pressing for departure was to come up with a clear vision of the country’s future, inside or out.
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